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This management's discussion and analysis of financial condition and results of
operations ("MD&A") is intended to provide an understanding of our results of
operations, financial condition and where appropriate, factors that may affect
future performance. The following discussion of our results of operations and
financial condition should be read in conjunction with the "Selected Historical
Consolidated Financial Data" and our audited consolidated financial statements
and related notes thereto included elsewhere in this Annual Report on Form 10-K.

The following discussions include forward-looking statements that involve
certain risks and uncertainties, including those identified under "Item 1A. Risk
Factors" elsewhere in this Annual Report on Form 10-K. Our actual results could
differ materially from those discussed in these forward-looking statements. See
"Cautionary Note Regarding Forward-Looking Statements and Other Industry and
Market Data" elsewhere in this Annual Report on Form 10-K.

Overview of Business
We are the world's largest commercial operator of helicopters based on revenue
of $1.8 billion in fiscal 2014. We are also the world's largest commercial
operator of heavy and medium helicopters based on our fleet of 236 heavy and
medium helicopters as of April 30, 2014. With bases on six continents, we are
one of only two global commercial helicopter service providers to the offshore
oil and gas industry. Our mission is to provide the highest level of service in
the industry, which we believe will enable our customers to go further, do more
and come home safely. With over 60 years of experience providing helicopter
services, we believe our brand and reputation have become associated with safe
and reliable transportation and mission-critical logistics solutions. Our fleet
of heavy and medium helicopters, global capabilities and reputation for safety
position us to capitalize on anticipated increases in ultra-deepwater and
deepwater drilling and production spending by our major, national and
independent oil and gas company customers.

Our helicopters are primarily used to facilitate large, long-distance crew
changes on offshore production facilities and drilling rigs. We also provide
search and rescue services, or SAR, and emergency medical services, or EMS, to
government agencies. We maintain a presence in most major offshore oil and gas
markets through a network of approximately 70 bases with operations in
approximately 30 countries, more than any other commercial helicopter service
provider in the world. We cover this expansive and diverse geography with a
technologically advanced fleet of 236 helicopters and the expertise to serve
customers in ultra-deepwater and deepwater locations. To secure and maintain
operating certificates in the many jurisdictions in which we provide helicopter
services, we must meet stringent and diverse regulatory standards across
multiple jurisdictions, and have an established track record in obtaining and
maintaining certificates as well as working with regulators and local partners.

We generate the majority of our oil and gas customer Helicopter Services revenue
from contracts tied to our customers' offshore production operations, which have
long-term transportation requirements. A substantial portion of our remaining
oil and gas customer Helicopter Services revenue comes from transporting
personnel to and from offshore drilling rigs, and we believe this capability
allows us to take advantage of expansion in the global ultra-deepwater rig
fleet. Approximately 73% to 78% of the flying revenue in our Helicopter Services
segment was attributable to fixed monthly charges for the fiscal years ended
April 30, 2012, 2013 and 2014.

We also provide maintenance, repair and overhaul, or MRO, services through our
Heli-One business to both our own Helicopter Services segment and to third-party
customers. Our MRO capabilities enable us to perform heavy structural repairs,
and maintain, overhaul and test helicopters and helicopter components globally
across various helicopter types. We believe our in-house MRO operations through
our Heli-One business enable us to manage our supply chain and maintain our
fleet more efficiently, thereby increasing the availability of our helicopters
and reducing our overall cost of maintenance. In addition, we are the largest
provider of these services (excluding original equipment manufacturers, or
OEMs), which allows us to provide our Heli-One customers with comprehensive MRO
services across multiple helicopter types and families. Our MRO services include
complete maintenance outsourcing solutions, parts sales and distribution,
engineering services, design services and logistics support.

Segments
We report under two operating segments and have a Corporate segment comprised
primarily of general and administration costs. Our two operating segments are as
follows:
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Helicopter Services:
• Our Helicopter Services segment consists of flying operations in the
Eastern North Sea, the Western North Sea, the Americas, the Asia Pacific
region and the Africa-Euro Asia region, primarily serving our offshore oil
and gas customers and providing SAR and EMS to government agencies. The
Eastern North Sea is comprised mainly of Norway while the Western North Sea includes the United Kingdom, Ireland and the Netherlands. The Americas
is comprised of Brazil, North American countries and other South American
countries. The Asia Pacific region includes Australia and Southeast Asian
countries and the Africa-Euro Asia region includes Nigeria, Equatorial
Guinea, Kazakhstan, Mozambique, Tanzania and other African and European
countries.

• Helicopter Services generated approximately 87% to 90% of its revenue for
the three years ended April 30, 2014 from oil and gas customers, and of
this amount, the majority is tied to our customers' offshore production
operations, which have long-term transportation requirements.

• Helicopter Services also provides SAR and EMS to government agencies and
to our oil and gas customers. SAR and EMS revenue to non-oil and gas
customers has historically contributed approximately 10% to 11% of
Helicopter Services revenue for the three years ended April 30, 2014.

Heli-One:
• Our Heli-One segment includes helicopter maintenance, repair and overhaul
facilities in Norway, Poland, Canada and the United States, providing
helicopter maintenance, repair and overhaul services for our fleet and for
a growing external customer base in Europe, Asia and North America.

Although intersegment revenues are eliminated from the presentation of our
consolidated financial information, operationally, Heli-One's largest
customer is our Helicopter Services segment.

• We have historically generated the majority of our third-party Heli-One
revenue by providing maintenance, repair and overhaul services to other
helicopter operators. Approximately 28%, 34% and 38% of our third-party
Heli-One revenue in the 2012, 2013 and 2014 fiscal years, respectively,
was derived from "power by the hour" contracts, where the customer pays a
ratable monthly charge, typically based on the number of hours flown, for
all scheduled and un-scheduled maintenance.

Key Financial and Operating Metrics
We use a number of key financial and operating metrics to measure the
performance of our business, including Adjusted EBITDAR, Adjusted EBITDAR
excluding special items, Adjusted EBITDAR margin, Adjusted EBITDAR margin
excluding special items, Adjusted net loss, and our Heavy Equivalent Rate or HE
Rate. None of Adjusted EBITDAR, Adjusted EBITDAR excluding special items,
Adjusted EBITDAR margin, Adjusted EBITDAR margin excluding special items,
Adjusted net loss or HE Rate is required by, or presented in accordance with
United States Generally Accepted Accounting Principles ("GAAP"). These non-GAAP
measures are not performance measures under GAAP and should not be considered as
alternatives to net earnings (loss) or any other performance or liquidity
measures derived in accordance with GAAP. In addition, these measures may not be
comparable to similarly titled measures of other companies.

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The following charts show our revenue generated by segment, our HE Rate, our
Adjusted EBITDAR excluding special items, our Adjusted EBITDAR margin excluding
special items, operating income and operating margin for the fiscal years ended
April 30, 2012, 2013 and 2014:
[[Image Removed]]
(1) HE Rate is the third-party operating revenue from our Helicopter Services
segment excluding reimbursable revenue divided by a weighted average factor
corresponding to the number of heavy and medium helicopters in our fleet. Our
heavy and medium helicopters, including owned and leased, are weighted at 100%
and 50%, respectively, to arrive at a single HE count, excluding helicopters
expected to be retired from our fleet.

(2) Adjusted EBITDAR margin excluding special items is calculated as Adjusted
EBITDAR excluding special items divided by total revenue less reimbursable
revenue. Cost reimbursements from customers are recorded as reimbursable
revenue with the related reimbursement expense in direct costs.

(3) Operating margin is calculated as operating income divided by total revenue.

Adjusted EBITDAR, Adjusted EBITDAR excluding special items, Adjusted EBITDAR
margin, Adjusted EBITDAR margin excluding special items, Adjusted net loss and
HE Rate are non-GAAP financial measures. We have chosen to include Adjusted
EBITDAR, and Adjusted EBITDAR excluding special items, as we consider these
measures to be significant indicators of our financial performance and we use
these measures to assist us in allocating available capital resources. Adjusted
EBITDAR is defined as net earnings (loss) before interest, taxes, depreciation,
amortization and helicopter lease and associated costs or total revenue plus
earnings from equity accounted investees, less direct costs excluding helicopter
lease and associated costs less general and administration costs. Adjusted
EBITDAR also excludes restructuring costs, asset impairments, gain (loss) on
disposal of assets and goodwill impairment, if any. Adjusted EBITDAR excluding
special items excludes stock-based compensation triggered by our initial public
offering and expenses related to the initial public offering, including costs
related to restructuring our compensation plan. For additional information about
our segment revenue and Adjusted EBITDAR, including a reconciliation of these
measures to our consolidated financial statements, see Note 25 of the annual
audited consolidated financial statements for the fiscal years ended April 30,
2012, 2013 and 2014 included elsewhere in this Annual Report on Form 10-K.

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We have chosen to include Adjusted net loss as it provides us with an
understanding of the results from the primary activities of our business by
excluding items such as stock-based compensation triggered by the initial public
offering and expenses related to the initial public offering, including costs
related to restructuring our compensation plans, asset dispositions, asset
impairments, loss on debt extinguishment, the revaluation of our derivatives and
foreign exchange gain (loss), which is primarily driven by the translation of
U.S. dollar balances in entities with a non-U.S. dollar functional currency.

This measure excludes the net earnings or loss attributable to non-controlling
interests. We believe that this measure is a useful supplemental measure as net
loss includes these items, and the inclusion of these items are not meaningful
indicators of our ongoing performance. For additional information about our
Adjusted net loss, including reconciliation to our consolidated financial
statements, see "Summary of the Results of Operations."
We have chosen to include the HE Rate, which is the third-party operating
revenue from the Helicopter Services segment excluding reimbursable revenue
divided by a weighted average factor corresponding to the number of heavy and
medium helicopters in our fleet. Our heavy and medium helicopters, including
owned and leased, are weighted at 100% and 50%, respectively, to arrive at a
single HE count, excluding helicopters expected to be retired from the fleet. We
believe this measure is useful as it provides a standardized measure of our
operating revenue per helicopter taking into account the different revenue
productivity and related costs of operating our fleet mix of heavy and medium
helicopters.

Key Drivers Affecting our Results of Operations
Our results of operations and financial condition are affected by numerous
factors, including those described under Part I, Item 1A "Risk Factors,"
elsewhere in this Annual Report on Form 10-K and those described below:
• General level of offshore production and drilling activity. Demand for our
services depends primarily upon ongoing offshore hydrocarbon production
and the capital spending of oil and gas companies and the level of
offshore drilling activity. Higher activity levels can lead to greater
utilization of our helicopters by our customers. Because a large portion
of our costs are fixed, our Adjusted EBITDAR margins typically improve
when more of our helicopters are deployed.

• Timing of new contracts and our commencement of service under new
contracts. Our results of operations in a particular period can be impacted by the timing of the execution of new contracts and our ability
to provide services under new contracts.

Market Outlook
We generate the majority of our Helicopter Services revenue from contracts tied
to our oil and gas customers' offshore production operations, which have
long-term transportation requirements. A substantial portion of our remaining
oil and gas customer Helicopter Services revenue comes from transporting
personnel to and from offshore drilling rigs, and we believe this capability
allows us to take advantage of expansion in the global ultra-deepwater rig
fleet. Approximately 73% to 78% of the flying revenue in our Helicopter Services
segment was attributable to fixed monthly charges for the fiscal years ended
April 30, 2012, 2013 and 2014. The production business is typically less
cyclical than the exploration and development business because production
platforms remain in place over the long-term and are relatively unaffected by
economic cycles, as the marginal cost of lifting a barrel of oil once a platform
is in position is low. Our customers typically base their capital expenditure
budgets on their long-term commodity price expectations.

Our MRO services, operated through our Heli-One business, are dependent on
helicopter maintenance demand. This is generally highest during periods of high
helicopter service demand where high flying hours result in more frequent
maintenance, most of which is required by regulation.

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We have seen an increase in ultra-deepwater and deepwater spending by our
customers and we are optimistic that growth will continue in future periods. We
are continuing to see growth in offshore production as the industry moves
offshore to find hydrocarbons. New technology has allowed oil and gas companies
to continue exploration and drilling farther offshore. To remain competitive and
to service existing and new contracts in this industry, we are augmenting our
fleet by adding technologically advanced helicopters to meet customers' changing
demands. The industry is constrained by the pace at which it renews its fleet
due to the limited supply of new technology helicopters produced annually by the
OEMs. To address this constraint, we have leveraged our relationship with the
OEMs to secure commitments to obtain new technology helicopters to support our
future growth.

During the year ended April 30, 2014, we took delivery of 13 helicopters. At
April 30, 2014, we have commitments to purchase 28 helicopters, with the
delivery of these helicopters beginning in fiscal 2015 and continuing through to
fiscal 2017. These helicopters will be purchased outright or financed through
leases. We also have the option to purchase 25 helicopters which, if exercised,
would bring our total purchase commitments to 53 helicopters. In addition to
this, we have committed to $100.0 million of additional helicopter purchases
with Airbus Helicopters.

The North Sea continues to be our core operating area, with approximately half
of Helicopter Services' revenue being derived from this region. We have
continued to build and renew our customer relations and contracts in this
region. In June 2014, we won a new multi-year oil and gas contract in the U.K.

to provide flying services to the Mariner field off the coast of Scotland.

Brazil and certain countries in the Africa-Euro Asia region, particularly
Nigeria, are expected to contribute increasingly to our revenue in future
periods due to an increase in ultra-deepwater and deepwater oil and gas activity
in those regions. We renewed our presence in Nigeria during fiscal 2014 through
our local partner, Atlantic Aviation, who commenced commercial operations with
AW139 type helicopters. We also obtained our own aircraft operating license in
Tanzania. In order to provide further support to our customers in Brazil, we
opened a new hangar facility in Cabo Frio in close proximity to the Campos Basin
off the Brazilian coast. In addition, we have been seeking to expand in other
regions. In May 2014, we won a new contract to provide helicopter services to an
exploration rig in the Atlantic Ocean, off the coast of Newfoundland, Canada. We
have also made continued wins for the year to date with new contracts in the
U.K., Norway, Kenya, Malaysia, Ireland, Brazil, Australia, Equatorial Guinea and
East Timor.

Heli-One continues to develop its third-party business, with recent contract
wins in the United Kingdom, where we have gained engine-specific support
certification from the Ministry of Defence's Military Aviation Authority, and
also in Europe, Brazil and the U.S. To further support the growth of our
Heli-One business and expand our global footprint, we opened an additional
facility in Poland in fiscal 2013, which has now re-located into a new 65,000
square feet customized hangar in Rzeszow, Poland in April 2014. We continue to
review and improve our global inventory management processes through a number of
lean process techniques to support efficiencies in our workshops and our supply
chain for our business operations. In January 2014, we opened our new Global
Distribution Center in Amsterdam as part of our continued enhancement of our
global supply chain. We are expanding our on-line capabilities to provide
customers with portal access to our available parts and exchanges through our
portal known as EPIC (Exchange Parts Inventory Channel). We have also been
working to improve and expand our global agent and channel partner network where
we have signed new agents and channel partners in numerous key regions.

We believe our broad transformation program will provide significant value to
our operations. This program looks at all major aspects of our operations and
includes a number of work streams, each including many initiatives. The program
includes transformative thinking and technology to achieve cost efficiencies
through global standardization and organizational efficiency to allow us to
enhance our earnings and cash flows. We opened our centralized Integrated
Operations Center in Irving, Texas in fiscal 2013. The centralization process
has been rolled out on a region by region basis, a process which is expected to
be complete by the end of the 2014 calendar year. We are continuing to complete
the implementation of our long-term crew planning and scheduling program, AIMS,
to further improve customer service levels. This system improves crew scheduling
the integration of crew rosters, allows integrated training planning and
enhanced key performance indicator reporting to improve crew and helicopter
productivity. This system will be linked with our Operations Flight Planning
System, which forms part of the electronic flight bag for pilots, a measure
undertaken to reduce paperwork and improve pilot efficiency. We have also
implemented a global base transformation initiative, which is a global program
aimed at improving base efficiency through the implementation of measures
designed to improve crew and field operations efficiency and reduce our aircraft
on ground days. In addition, we have implemented a global indirect procurement
review, aimed at generating cost savings through more sophisticated supply chain
management, e-procurement implementation, bulk purchasing, and vendor selection.

We believe these transformative actions will allow us to maximize our value
proposition to our customers.

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We conduct our business in various foreign jurisdictions, and as such, our cash
flows and earnings are subject to fluctuations and related risks from changes in
foreign currency exchange rates. Throughout the fiscal year ended 2014, our
primary foreign currency exposures were related to the Norwegian Kroner, the
Euro, the British pound sterling, the Brazilian Real, the Canadian dollar and
the Australian dollar. For details on this exposure and the related impact on
our results of operations, see Part I, Item 7A "Quantitative and Qualitative
Disclosures About Market Risk" included elsewhere in this Annual Report on Form
10-K.

Recent Developments
Following an incident in October 2012 that led to the widespread suspension of
all over-water Airbus Helicopters EC225 helicopters, extensive investigation by
the manufacturer, independent analysis and Authority-approved modifications to
the helicopters were completed and we commenced in July 2013 the phased
re-introduction of our EC225 fleet to full service. Full regular service on the
Airbus Helicopters EC225 fleet was completed during the fourth-quarter of the
2013 calendar year in conjunction with robust interim safety measures.

On June 11, 2014, the UK Air Accident Investigation Branch, or UK AAIB, issued
its final report into this and a related May 2012 incident by another operator.

Neither the foregoing website nor the information contained on the website nor
the report accessible through such website shall be deemed incorporated into,
and neither shall be a part of, this Annual Report on Form 10-K. The root cause
of the incident was attributed to the bevel gear vertical shaft design. In April
2014, Airbus Helicopters announced that a redesigned vertical gear shaft had
been approved by the European Aviation Safety Agency, or EASA. The retrofitting
of the redesigned gear shaft has begun, with the expectation that this retrofit
program will be completed within twelve months.

On August 23, 2013, one of our Airbus Helicopters AS332L2 heavy helicopters was
involved in an accident near Sumburgh in the Shetland Isles, United Kingdom.

Authorities subsequently confirmed four fatalities and multiple injuries among
the 16 passengers and two crew members on board. The cause of the accident is
not yet known and full investigations are being carried out in conjunction with
the UK AAIB, and Police Scotland.

Despite engineering and operating differences between the AS332L2, AS332L,
AS332L1 and EC225 helicopters, for a limited period, we voluntarily canceled all
our flights worldwide on those helicopter types (except for those involved in
life-saving missions), out of respect for our work force and those of our
customers, and to evaluate any implications associated with the accident.

Within a week of the accident, after consultation with our principal regulators,
customers, union representatives and industry groups, and based on findings that
there was no evidence to support a continuation of our temporary voluntary
suspension and, on recommendations to return to active service all variants of
these helicopter types, we resumed commercial passenger flights with all of
these helicopter types to and from offshore oil and gas installations worldwide,
excluding those in the UK with AS332L2 helicopters. We resumed AS332L2
commercial flights in the UK in mid-September. All of these helicopter types
have now been returned to commercial operations worldwide.

Neither the foregoing website nor the information contained on the website nor
the report accessible through such website shall be deemed incorporated into,
and neither shall be a part of, this Annual Report on Form 10-K. In the special
bulletin, the UK AAIB confirmed that, to date, the wreckage examination and
analysis of recorded data as well as information from interviews of people
involved in the accident have not found any evidence of a technical fault that
could have been causal to the accident. The investigations by the UK AAIB and
Police Scotland are ongoing. On January 23, 2014, the UK AAIB issued a further
special bulletin (S1/2014) on the accident which contained enhanced pre-flight
safety briefing recommendations relating to the use of the passenger
re-breather; these recommendations were implemented in all regions where this
equipment was in use. It is too early to determine the extent of the impact of
the accident on our results of operations or financial condition based on
information currently available.

Neither the foregoing website nor the information contained on the website nor
the report accessible through such website shall be deemed incorporated into,
and neither shall be a part of, this Annual Report on Form 10-K. The report's
prescribed actions and recommendations were the result of a comprehensive review
of offshore helicopter operations, undertaken in conjunction with the Norwegian
Civil Aviation Authority and the EASA. The UK CAA identified several actions
intended to minimize the risk of further accidents and to improve the
survivability in the event of an accident; those actions/recommendations
included prohibiting helicopter flights in certain sea conditions, except in
response to an emergency, relative to the sea conditions for which the
helicopter has been certificated, and only allowing passengers to be seated next
to push-out window exits unless all passengers have enhanced emergency breathing
equipment or the helicopter is fitted with side floats. The review also
identified several other areas of activity to further enhance the levels of
safety in the offshore helicopter industry. In May 2014, the UK CAA announced
certain changes to the timing of the implementation of the measures within this
report, which include the delay of seating restrictions until September 1, 2014.

On July 3, 2014, one of our helicopters conducted a medivac flight of a
reportedly ill oil worker from the Troll A platform in the North Sea. During
the flight, the patient freed himself from his safety belts and exited the
helicopter through an emergency window at 600 meters above the sea. His remains
were subsequently recovered from the sea. We are fully cooperating with the
police and aviation authorities in their investigation.

These helicopters are expected to be delivered in fiscal 2015 ($351.4 million),
2016 ($251.9 million) and 2017 ($84.9 million) and will be deployed in our
Helicopter Services segment. We intend to enter into leases for these
helicopters or purchase them outright upon delivery from the manufacturer.

Additionally, we have committed to purchase $61.4 million of helicopter parts by
October 31, 2015 and $100.0 million of heavy helicopters from Airbus Helicopters
prior to December 31, 2016. In addition, at April 30, 2014, we had the option to
purchase 25 heavy and medium helicopters which, if exercised, would represent a
total purchase commitment of 53 helicopters, excluding the committed dollar
amount with Airbus Helicopters. We have a pipeline of opportunities identified
that we believe will create long-term contracts for these new helicopters.

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The following table shows the expected delivery dates of the helicopter purchase
commitments and options referred above:
Number of helicopters
Purchase
commitments (i) Options
2015 15 2
2016 10 8
2017 3 9
2018 and thereafter - 6
28 25
(i) Does not include helicopters related to our commitment to purchase $100.0
million of heavy helicopters from Airbus Helicopters or our intention to lease
four helicopters from an independent lessor, with four planned deliveries in the
fiscal year ended April 30, 2015.

(ii) See "-Key Financial and Operating Metrics" for the definition and discussion
of these non-GAAP measures. Additional information about our Adjusted
EBITDAR, including a reconciliation of this measure to our consolidated
financial statements is also provided in Note 25 of the annual audited
consolidated financial statements for the fiscal years ended April 30, 2012,
2013 and 2014 included elsewhere in this Annual Report on Form 10-K. See
below for our reconciliation of Adjusted EBITDAR excluding special items,
Adjusted EBITDAR margin and Adjusted EBITDAR margin excluding special items,
which we have included because we consider these measures to be significant
indicators of our financial performance and management uses these measures
to assist us in allocating available capital resources.

This is reconciled to Adjusted EBITDAR as follows:
For the fiscal year ended April 30,
2012 2013 2014
Adjusted EBITDAR excluding special items $ 419,535 $ 484,351 $ 470,940
Stock-based compensation
- - (23,389 )
Expenses related to the initial public offering - - (2,563 )
Adjusted EBITDAR $ 419,535 $ 484,351 $ 444,988
(iii) Adjusted net loss is a non-GAAP measure that has not been prepared in
accordance with GAAP and has not been audited or reviewed by our
independent auditors. We have chosen to include adjusted net loss as it
provides us with an understanding of the results from the primary
activities of our business by excluding items such as stock-based compensation triggered by the initial public offering and expenses related
to the initial public offering, including costs related to restructuring
our compensation plans, asset dispositions, asset impairments, loss on debt
extinguishment, the revaluation of our derivatives and foreign exchange
gain (loss), which is primarily driven by the translation of U.S. dollar
balances in entities with a non-U.S. dollar functional currency. This
measure excludes the net earnings or loss attributable to non-controlling
interests. We believe that this measure is a useful supplemental measure as
net loss includes these items, and these items are not meaningful
indicators of our ongoing performance. A description of the adjustments to
and reconciliations of this non-GAAP financial measure to the most
comparable GAAP financial measure is as follows:
For the fiscal year ended April 30,
2012 2013 2014
Adjusted net loss $ (95,599 ) $ (62,184 ) $ (96,689 )
Stock-based compensation - - (23,389 )
Expenses related to the initial public offering - - (2,563 )
Asset impairments (17,651 ) (29,981 ) (25,933 )
Gain (loss) on disposal of assets 8,169 (15,483 ) (6,631 )
Foreign exchange gain (loss) 1,819 (11,383 ) (6,028 )
Debt extinguishment - - (7,668 )
Unrealized loss on derivatives (5,380 ) (405 ) (3,647 )
Net loss attributable to controlling interest $ (108,642 ) $ (119,436 ) $ (172,548 )
(iv) HE Rate is a non-GAAP measure that has not been prepared in accordance with
GAAP and has not been audited or reviewed by our independent auditors. HE rate
is the third-party operating revenue from the Helicopter Services segment
excluding reimbursable revenue divided by a weighted average factor
corresponding to the number of heavy and medium helicopters in our fleet. Our
heavy and medium helicopters, including owned and leased, are weighted as 100%
and 50%, respectively, to arrive at a single HE count, excluding helicopters
expected to be retired from our fleet. An average of this figure is used to
calculate our HE Rate. See "-Key Financial and Operating Metrics" for discussion
of this non-GAAP financial measure. See below for the reconciliation of HE Rate.

(ii) Includes $103.8 million in fuel costs for the fiscal year ended April 30,
2013 and $97.2 million for the fiscal year ended April 30, 2014.

(iii) HE Rate is the third-party operating revenue from the Helicopter Services
segment excluding reimbursable revenue divided by a weighted average factor
corresponding to the number of heavy and medium helicopters in our fleet.

Our heavy and medium helicopters, including owned and leased, are weighted
at 100% and 50% respectively to arrive at a single HE count, excluding
helicopters expected to be retired from our fleet. An average of this
figure is used to calculate our HE Rate.

Consolidated Results of Operations
Revenue
Revenue increased by $21.1 million to $1,765.0 million compared to fiscal 2013,
with $14.3 million of the increase from Helicopter Services and $6.8 million of
the increase from Heli-One.

Helicopter Services
For the fiscal year ended April 30,
(in thousands of U.S. dollars)
Favorable (Unfavorable)
2013 2014 $ Change % Change
Eastern North Sea $ 365,350 $ 383,381 $ 18,031 4.9 %
Western North Sea 395,173 421,955 26,782 6.8 %
Americas 302,089 276,911 (25,178 ) (8.3 )%
Asia Pacific 346,737 343,989 (2,748 ) (0.8 )%
Africa-Euro Asia 185,566 186,544 978 0.5 %
Other 8,488 4,928 (3,560 ) (41.9 )%
Total $ 1,603,403 $ 1,617,708 $ 14,305 0.9 %
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The total external revenue for Helicopter Services increased by $14.3 million
compared to fiscal 2013, with the results for the overall period influenced by
the suspension of the EC225 helicopters, primarily in the first six months of
fiscal 2014. The key variances by region were as follows:
• Eastern North Sea. Revenue in the Eastern North Sea increased by $18.0
million compared to fiscal 2013. There was a $23.7 million increase in
revenue primarily due to new contract wins for the oil and gas sector, in
addition to higher levels of other rechargeable and reimbursable revenue
of $3.5 million. The increase was offset in part due to lost revenue as a
result of the EC225 suspension of $5.3 million and lower revenue of $3.7
million due to variations in activity levels with other ongoing oil and
gas customer contracts.

• Western North Sea. Revenue in the Western North Sea increased by $26.8
million compared to fiscal 2013, primarily due to existing oil and gas customers requiring additional helicopters in Scotland, which generated
additional revenue of $33.3 million compared to fiscal 2013. Revenue
increased in Ireland by $19.5 million as a result of the transition of an
existing SAR customer to more technologically advanced helicopters. In the
UK, revenue increased by $3.2 million over fiscal 2013 primarily due to
short-term contract work. We also earned additional revenue of $1.7
million in fiscal 2014 from a new contract win based in Malta. These increases were partially offset by a reduction in the scope of our UK SAR
contract, which reduced revenue by $18.0 million; the expiration of a
contract in Denmark which decreased revenue by $7.4 million as well as
reduction in revenue due to the EC225 suspension of $5.5 million.

• Americas. Revenue in the Americas decreased by $25.2 million compared to
fiscal 2013, primarily due to decreased revenue activity in Brazil of
$17.7 million, primarily as a result of the EC225 suspension in the first half of fiscal 2014. In addition, the expiration of customer contracts in
the Falkland Islands and Canada decreased revenue by $18.8 million
compared to fiscal 2013. These decreases were offset in part by an $11.6
million increase in revenue from a contract win in Nicaragua for three
medium helicopters, which commenced in June 2013.

• Asia Pacific. Asia Pacific revenue decreased by $2.7 million compared to
fiscal 2013, primarily due to reductions in Australia and South East Asia
of approximately $37.8 million and $7.4 million respectively, due to the
completion of certain oil and gas customers' contracts and due to lower
revenue earned with existing customers, principally as a result of decreased SAR flying hours. Furthermore, there was a $1.9 million decrease
in revenue due to the EC225 suspension. These decreases were offset by new
contract wins and contract modifications for oil and gas customers in East
Timor and other South East Asia countries of $23.8 million and in
Australia of $19.8 million, compared to fiscal 2013.

• Africa-Euro Asia. Africa-Euro Asia revenue increased by $1.0 million
compared to fiscal 2013, primarily due to contract wins in Africa which
resulted in additional revenue of $26.5 million. Our operations in
Nigeria, where we have a renewed presence, earned revenue of $4.7 million
for fiscal 2014. Offsetting these increases were contract expirations in
South Africa, Liberia and other countries approximating $18.3 million and
reduced demand in Kazakhstan, primarily due to changes in oil and gas
customers' stage of production, of approximately $11.6 million compared to
fiscal 2013.

• Other. Other revenue decreased by $3.6 million, primarily due to a
reduction in dry lease revenue compared to fiscal 2013.

This was due primarily to an increase in PBH revenue of $4.0 million, generated
from new customer contracts, including work with the United Kingdom's Ministry
of Defence, and $2.8 million of higher non-PBH project revenue, which includes
airframe, engine and component work. Non-PBH revenue increased primarily due to
a higher level of airframe project work, which was offset by lower levels of
engine repair work, compared to fiscal 2013.

Crew costs, including salary, benefits, training and recruitment, decreased by
$0.1 million to $429.1 million compared to fiscal 2013. Crew costs vary due to
changes in contract activity levels within our Helicopter Services business and
have remained flat over fiscal 2013 despite regional variances. Crew costs
increased over fiscal 2013 as a result of new contract work primarily in the
Eastern and Western North Sea of $5.3 million and in Nigeria by $3.8 million,
where we have renewed presence in that country. These increases were offset by a
reduction in crew costs in other regions of $9.2 million due to changing levels
of customer activity, primarily in Asia Pacific and in other African countries
due to the timing of contract expirations and new contract commencements. Crew
costs were incurred only by our Helicopter Services segment.

Base operations and other costs, which include our base operations, reimbursable
costs, insurance costs and other external expenses, decreased by $14.1 million
to $352.0 million compared to fiscal 2013. The majority of base operations and
other costs related to our Helicopter Services segment, with $29.9 million
related to our Heli-One segment, which have remained flat compared with fiscal
2013. There was a $25.0 million reduction in costs in our Helicopter Services
segment over fiscal 2013, as a result of the receipt of insurance recoveries and
due to reductions in costs in Australia, the Americas and in other African
countries, primarily due to contract completions in these regions. Base costs
also decreased in Brazil due to lower reimbursable fuel costs, with our new Cabo
Frio facility being in close proximity to customer sites. These reductions were
offset by higher costs incurred in the North Sea of $8.4 million, primarily due
to higher levels of reimbursable costs which were driven by higher customer
activity, and in Nigeria of $2.5 million, due to our renewed operations in that
country.

Maintenance costs increased by $49.2 million to $281.7 million compared to
fiscal 2013. Maintenance costs were primarily related to our Helicopter Services
segment but are incurred almost entirely by Heli-One, which conducts maintenance
work for Helicopter Services and also for external customers. Approximately
two-thirds of these costs were related to Helicopter Services.

A significant part of the increase in maintenance costs over fiscal 2013 was
related to the EC225 fleet. Maintenance costs include cash and immediately
available credits, received in light of the EC225 suspension, which were booked
as reductions to maintenance costs as they related to short-term performance
issues. We incurred $10.1 million of costs in preparing the EC225 helicopters
for return to service following the suspension. On resumption of EC225
commercial operations, our Helicopter Services segment incurred an additional
$4.0 million of costs related to additional ongoing inspection costs of the
helicopters, which are being incurred until the gear shaft retrofit is
completed. See "-Recent Developments" included elsewhere in this Annual Report
on Form 10-K for further information. In addition, higher maintenance activity
was experienced on helicopters used as replacements during the EC225 suspension.

Furthermore, on the resumption of the EC225 fleet's normal commercial operations
in the latter part of fiscal 2014, additional maintenance costs were incurred
over fiscal 2013, primarily due to the timing of costs incurred on subcontracted
maintenance work on the EC225 fleet.

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Maintenance costs also increased compared to fiscal 2013 due to strategic
initiatives and the life cycle of new technology helicopters. During fiscal
2014, we experienced higher maintenance costs on new technology helicopters
which are no longer under OEM warranty. Maintenance costs also increased over
fiscal 2013 as a result of additional spend on rotable parts maintenance in our
MRO business. The costs incurred for the maintenance work on rotable parts are
expensed as incurred. These increases were offset by $3.0 million of lower
maintenance costs incurred to support external non-PBH revenue due primarily to
the mix of work being performed for external customers and higher efficiency in
certain of our workshops compared with fiscal 2013.

Support costs, which include certain regional executive functions, flights
operations, safety, technical support, information technology and customer
service costs, increased by $7.0 million to $169.4 million compared to fiscal
2013, due primarily to a combination of higher facilities and information
technology costs incurred by Helicopter Services, and an additional $3.7 million
of support costs, including salary and consulting costs, incurred for the start
up of our Nigeria operations. The majority of support costs are incurred by
Helicopter Services, with $25.3 million related to our Heli-One segment, which
have decreased by $3.1 million over fiscal 2013, primarily due to lower salary
and benefit costs incurred in fiscal 2014.

Helicopter Lease and Associated Costs
Helicopter lease and associated costs increased by $26.2 million to $227.9
million, due primarily to an increase in new technologically advanced
helicopters. We are continuing to acquire new technologically advanced
helicopters to meet our customers' needs as they continue production,
exploration and development into deeper waters. We anticipate we will continue
to finance helicopters through operating leases and may make strategic decisions
as required to purchase certain helicopters outright. The purchase of
helicopters allows for greater jurisdictional flexibility as some lease
agreements restrict the movement of helicopters to certain countries.

General and Administrative Costs
General and administrative costs increased by $21.0 million to $95.1 million
compared to fiscal 2013. The increase was primarily due to increased stock-based
compensation expense of $25.7 million and additional costs related to our IPO on
the New York Stock Exchange. The stock-based compensation expense has increased
primarily as a result of performance conditions under our 2011 Management Equity
Plan being met at the time of our IPO. For more information, see Note 17 of the
annual audited consolidated financial statements for the fiscal years ended
April 30, 2012, 2013 and 2014 included elsewhere in this Annual Report on Form
10-K. These increases were partially offset by lower information technology
costs relating to software implementation, and lower consulting and other salary
costs compared to fiscal 2013.

Depreciation
Depreciation expense increased by $12.6 million to $144.6 million compared to
fiscal 2013. The increase was primarily due to a depreciation review conducted
in our Helicopter Services segment during the third quarter of fiscal 2013, with
the effects of the review first showing in our results in the fourth quarter of
2013. We plan to exit certain helicopter types after the helicopters complete
existing customer contracts over the period from 2015 to 2018. When we conducted
our depreciation review, we reduced the useful lives and residual values of 18
helicopters that will be exited and fiscal 2014 reflects a higher rate of
depreciation as a result. In our Heli-One segment, depreciation increased
primarily due to an increase in rotable parts, which can be repaired and re-used
for several years to service the new technologically advanced helicopters. Of
the fiscal 2013 depreciation expense, $78.8 million related to Heli-One, $52.3
million related to Helicopter Services and the remainder related to the
Corporate Segment. Of the fiscal 2014 depreciation expense, $86.5 million was
related to Heli-One and $57.3 million was related to Helicopter Services and the
remainder related to the Corporate Segment.

Restructuring Costs
Restructuring costs decreased by $11.0 million compared to fiscal 2013, with no
restructuring costs incurred in fiscal 2014. Of our restructuring costs in
fiscal 2013, $6.8 million related to the Corporate Segment, $2.6 million related
to the Helicopter Services segment, and $1.6 million related to the Heli-One
segment.

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Asset impairments
For the fiscal year ended Favorable
April 30, (Unfavorable)
(In thousands of U.S. dollars) 2013 2014 $ Change
Impairment of receivables and funded residual
value guarantees $ (1,671 ) $ (1,115 ) $ 556
Impairment of assets held for sale (12,164 ) (18,486 ) (6,322 )
Impairment of assets held for use (8,421 ) (5,453 ) 2,968
Impairment of intangible assets (7,725 ) (879 ) 6,846
Total asset impairments $ (29,981 ) $ (25,933 ) $ 4,048
Asset impairments decreased to $25.9 million, compared to $30.0 million in
fiscal 2013. The decrease was due to lower impairment on embedded equity, an
intangible asset, in combination with lower impairment on assets held for use,
compared to fiscal 2013. These decreases were offset partially by increased
impairment of assets held for sale in the Helicopter Services segment. The
primary reason for the change in impairment is due to changes in market
conditions. Of the fiscal 2013 asset impairments, $29.9 million related to the
Helicopter Services segment and $0.1 million related to the Corporate Segment.

Of the fiscal 2014 asset impairment expense, $24.8 million was related to
Helicopter Services and $1.1 million was related to the Corporate segment.

Interest on Long-Term Debt
Interest on long-term debt obligations increased by $26.0 million to $153.2
million compared to fiscal 2013, primarily due to interest on the additional
$200.0 million in senior secured notes issued on October 5, 2012 and the $300.0
million of senior unsecured notes issued on May 13, 2013 by CHC Helicopter S.A.,
our wholly owned subsidiary. The increase was offset in part by decreased
interest costs on our revolving credit facility of $5.7 million, due to lower
usage of this facility in fiscal 2014, and due to a reduction in interest
expense incurred on our senior secured notes, of which we redeemed $130.0
million on February 7, 2014.

Foreign Exchange Loss
Foreign exchange loss decreased by $5.4 million to a loss of $6.0 million
compared to fiscal 2013. Our foreign exchange loss was driven primarily by the
strengthening and weakening of foreign currency denominated assets and
liabilities against the functional currency of our subsidiary companies. During
fiscal 2014, the U.S. dollar strengthened against the Norwegian kroner and the
Canadian dollar but weakened against the Euro, which resulted in foreign
exchange losses due to the net monetary asset and liability positions held by
our subsidiaries.

Other Financing Charges
Other financing charges include the amortization of deferred financing costs,
interest income and expense on cash balances and bank indebtedness, and the net
gain or loss on the fair value of derivative financial instruments and embedded
derivatives. Other financing charges increased by $4.5 million to $23.3 million
compared to fiscal 2013 primarily due to a $7.7 million loss incurred on the
extinguishment of $130.0 million of our senior secured notes on February 7, 2014
and $5.0 million of higher amortization of deferred financing fees, due to new
the issuance of the $200.0 million in senior secured notes issued on October 5,
2012 and the $300.0 million of senior unsecured notes issued on May 13, 2013. In
addition, certain deferred financing costs incurred with our previous revolving
credit facility were expensed in fiscal 2014 as a result of the renegotiation of
this facility. See "-Liquidity and Sources of Liquidity-Future Cash
Requirements". A higher loss on the valuation of derivatives and embedded
derivatives of $2.6 million was incurred compared to fiscal 2013 due to foreign
currency movements. These increases were offset in part by a $10.0 million fee
settlement received during fiscal 2014.

Loss on Disposal of Fixed Assets
Loss on disposal of fixed assets decreased by $8.9 million to $6.6 million
compared to fiscal 2013, due primarily to a decrease in losses from the sale and
leaseback of helicopters in our Helicopter Services segment. Of the fiscal 2013
loss on disposal of fixed assets, $14.5 million related to the Helicopter
Services segment and $1.1 million related to the Heli-One segment, which were
partially offset by a gain of $0.1 million related to the Corporate Segment. Of
the fiscal 2014 loss on disposal of fixed assets, $3.4 million related to the
Helicopter Services segment and $3.2 million related to the Heli-One segment.

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Income Tax Expense
Income tax expense decreased by $26.1 million to $28.4 million compared to
fiscal 2013. The effective tax rate for fiscal 2013 was (86.3)% compared to
(19.9)% in fiscal 2014. The below table provides a breakdown of the items which
caused the change in tax expense between fiscal 2013 and 2014:
Increase (decrease) Effective
(In millions of U.S. dollars) in tax expense tax rate
Income tax expense at April 30, 2013 $ 54.5 (86.3 )%
Rate differences in various jurisdictions
and other foreign taxes (38.0 )
Non-deductible items 34.4
Functional currency adjustments (8.6 )
Valuation allowance 0.1
Other items (14.0 )
Income tax expense at April 30, 2014 $ 28.4 (19.9 )%
The decrease in the income tax expense was primarily due to an increase in the
tax recovery calculated at the tax rate in effect in various jurisdictions in
which we operate, a higher level of non-taxable income in foreign jurisdictions
and the effect of functional currency adjustments, offset by a higher level of
non-deductible items compared to fiscal 2013.

The $38.0 million increase in the calculated recovery from rate differences in
various jurisdictions was primarily a result of higher losses incurred in fiscal
2014. This recovery was offset by valuation allowances for these tax losses. The
change in the valuation allowance has remained comparable with 2013, despite the
higher provision for losses in fiscal 2014, primarily due to a change in the
assessment of deferred tax asset recoverability in the U.S., Australia,
Netherlands and Norway EHOB (EEA Helicopters Operations B.V) in fiscal 2013. The
increase in non-deductible items of $34.4 million was primarily related to
higher levels of non-deductible interest, due to tax legislative changes that
occurred in Norway and the Netherlands, and non-deductible stock option
expenses, which increased in fiscal 2014 due to our IPO. Other items include the
impact of higher levels of non-taxable income in foreign jurisdictions, which
caused a decrease in the tax expense of $9.9 million compared to fiscal 2013,
and a $2.7 million reduction in income tax expense related to tax adjustments
for prior periods, compared to fiscal 2013. The adjustments related to prior
periods are fully provided for by valuation allowances and have no impact on our
overall tax expense.

The effective tax rate is the ratio of income tax expense to loss from
continuing operations before income tax. In addition to the impact on income tax
expense described in the preceding table, the reduction in the negative
effective tax rate from (86.3)% to (19.9)% resulted from an increase in the net
loss from continuing operations before income tax compared to fiscal 2013
without a corresponding change in income tax expense due to valuation allowances
recorded against deferred income tax assets in many jurisdictions, and a
reduction in tax expense compared to fiscal 2013 due to a higher amount of
uncertain tax positions recognized in fiscal 2013. In addition, a significant
component of income tax expense for the 2013 and 2014 fiscal years is
represented by income taxes in certain jurisdictions, such as withholding taxes,
which are not directly correlated to movements in the net loss from continuing
operations before income tax. Furthermore, movements in our loss from continuing
operations may occur in jurisdictions where we are not recognizing the benefit
of deferred tax assets, which could result in no corresponding movement in our
income tax expense.

Non-Controlling Interests
Net earnings allocated to non-controlling interests decreased by $1.3 million to
$1.6 million, due to a decrease in net earnings in EHOB, primarily from higher
helicopter lease and financing costs offset by a lower income tax expense
compared to fiscal 2013. See Note 3 of our annual audited consolidated financial
statements for the fiscal years ended April 30, 2012, 2013, and 2014 included
elsewhere in this Annual Report on Form 10-K.

(ii) Adjusted EBITDAR margin is calculated as Adjusted EBITDAR divided by total
revenue less reimbursable revenue. Cost reimbursements from customers are
recorded as reimbursable revenue with the related reimbursement expense in
direct costs.

(iii) HE Rate is the third-party operating revenue from the Helicopter Services
segment excluding reimbursable revenue divided by a weighted average factor
corresponding to the number of heavy and medium helicopters in our fleet.

Our heavy and medium helicopters, including owned and leased, are weighted
at 100% and 50% respectively to arrive at a single HE count, excluding
helicopters expected to be retired from our fleet. An average of this
figure is used to calculate our HE Rate.

Helicopter Services Adjusted EBITDAR increased by $18.2 million to $487.8
million and Adjusted EBITDAR margin increased by 1.0% compared to fiscal 2013.

Adjusted EBITDAR improved in the North Sea and in our Asia Pacific regions but
was flat in the Americas and declined in Africa-Euro Asia. The primary changes
which positively impacted Adjusted EBITDAR for Helicopter Services as compared
to fiscal 2013 were as follows:
• In the Eastern North Sea, contract wins from several customers, offset
by reduced ad-hoc and other non-recurring work and higher levels of
maintenance costs, resulted in a net increase to Adjusted EBITDAR of $10.9 million in fiscal 2014 compared to fiscal 2013. This increased
Adjusted EBITDAR margin by 0.5%;
• In the Western North Sea, Adjusted EBITDAR increased due to additional
helicopter requirements from existing oil and gas customers, in
addition to net new contract work in the Netherlands. These changes
improved Adjusted EBITDAR by $11.6 million and Adjusted EBITDAR margin
by 0.6%;
• Adjusted EBITDAR improved by $19.7 million due to an increase in oil
and gas activities in Southeast Asia, including East Timor, where new
contract wins and contract renewals increased Adjusted EBITDAR margin
by 1.0%;
• Reduced SAR and other contract activity in the United Kingdom was offset by additional SAR work in Ireland, as a result of the transition
of an existing customer to more technologically advanced helicopters,
which resulted in a net increase to Adjusted EBITDAR of $5.2 million
and a positive impact to Adjusted EBITDAR margin of 0.3%; and
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• Adjusted EBITDAR and Adjusted EBITDAR margin increased by $15.6 million
and 0.8% respectively due to new contract wins for oil and gas
customers in Africa and Central America.

These improvements to Adjusted EBITDAR and Adjusted EBITDAR margin were offset
primarily by the following factors which negatively impacted Adjusted EBITDAR
compared to fiscal 2013:
• Adjusted EBITDAR and Adjusted EBITDAR margin decreased by $18.3 million
and 0.9% respectively in Australia due to contract completions for oil
and gas customers;
• Adjusted EBITDAR and Adjusted EBITDAR margin decreased by $5.8 million
and 0.3% in our Africa-Euro Asia regions, including Tanzania, Liberia
and South Africa, primarily as a result of contract completions and the
expiration of short-term contract work;
• Adjusted EBITDAR decreased by $2.0 million in Kazakhstan due to oil and
gas customer requirements transitioning from exploration to production,
causing a reduction in demand which negatively impacted Adjusted
EBITDAR margin by 0.1%; and
• Adjusted EBITDAR in the Americas decreased $10.6 million and Adjusted
EBITDAR margin was impacted by 0.5% compared to fiscal 2013 due to the
expiration of customer contracts in the Falkland Islands.

In addition, we incurred certain additional costs in fiscal 2014 compared to
fiscal 2013 which negatively impacted Adjusted EBITDAR. These decreased Adjusted
EBITDAR by $10.1 million and Adjusted EBITDAR margin by 0.5%. These costs were
as follows:
• Higher costs, partially offset by contract revenue, decreased Adjusted
EBITDAR by $6.1 million in Nigeria due to additional crew, base and
other costs primarily associated with the set up and commencement of
operations within the country; and
• Higher costs of $4.0 million were incurred for additional ongoing
inspection costs of EC225 helicopters by our Helicopter Services
business. See Item 7. "Recent Developments" included elsewhere in this
Annual Report on Form 10-K for further information.

The balance of the change in Adjusted EBITDAR relates to changes in the results
of operations in our other regions and fleet operations, from centralized costs
and earnings from equity accounted investees compared to fiscal 2013. In fiscal
2014, earnings from equity accounted investees have increased by $2.5 million,
primarily as a result of additional earnings from our equity accounted
investment in Thai Aviation Services.

Helicopter leasing and associated costs increased by $26.2 million to $227.9
million, due primarily to an increase in technologically advanced helicopter
operating leases entered into during fiscal 2014, which have a higher lease
cost. We are acquiring technologically advanced helicopters to meet customers'
needs as they continue exploration and development into deeper waters. We
anticipate that we will continue to finance helicopters through operating leases
and may make strategic decisions as required to purchase certain helicopters
outright. The purchase of helicopters allows for greater jurisdictional
flexibility as some lease agreements restrict the movement of helicopters to
certain countries.

(ii) Adjusted EBITDAR margin is calculated as Adjusted EBITDAR divided by total
revenue less reimbursable revenue, of which there was none in the Heli-One
segment in fiscal 2013 and 2014.

Heli-One generates the majority of its revenue by supporting internal flying
operations. Adjusted EBITDAR decreased by $36.4 million to $55.3 million and
Adjusted EBITDAR margin decreased by 8.5% compared to fiscal 2013. The primary
changes compared to fiscal 2013 were as follows:
• Increased costs were incurred in fiscal 2014 to return the EC225
helicopter fleet to normal service. This had an unfavorable impact on
Adjusted EBITDAR of $10.1 million, which impacted Adjusted EBITDAR margin
by 2.4%;
• There was increased maintenance spend in fiscal 2014 for EC225 helicopters
on the resumption of normal commercial operations, including maintenance
activities which have been subcontracted to third-parties, which decreased
Adjusted EBITDAR by $10.0 million and Adjusted EBITDAR margin by 2.3%
compared to fiscal 2013;
• Increased costs were incurred in fiscal 2014 following the expiration of
warranties on new technology helicopters, including S92A and AW139
helicopters, the maintenance of rotable parts to improve helicopter
availability, and higher maintenance activity on helicopters used as
replacements during the EC225 suspension. These factors had an unfavorable
impact on Adjusted EBITDAR of $22.4 million, which impacted Adjusted
EBITDAR margin by 5.2%;
• These increased costs were offset an improvement in Adjusted EBITDAR of
$6.1 million, due to improved levels of maintenance efficiency and a
higher proportion of higher margin MRO work compared to fiscal 2013, in
addition to lower support costs. These cost reductions improved Adjusted
EBITDAR margin by 1.4%.

(ii) Includes $101.2 million in fuel costs for the fiscal year ended April 30,
2012 and $103.8 million for the fiscal year ended April 30, 2013.

(iii) HE Rate is the third-party operating revenue from the Helicopter Services
segment excluding reimbursable revenue divided by a weighted average factor
corresponding to the number of heavy and medium helicopters in our fleet.

Our heavy and medium helicopters, including owned and leased, are weighted
at 100% and 50% respectively to arrive at a single HE count, excluding
helicopters expected to be retired from our fleet. An average of this
figure is used to calculate our HE Rate.

Consolidated Results of Operations
Revenue
Revenue increased by $51.3 million to $1,743.8 million compared to fiscal 2012.

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North Sea. The Western North Sea contributed additional revenues of $11.4
million, due primarily to new contracts generated from an increase in oil and
gas activity in Scotland, England and Ireland. The increase in the Western North
Sea's revenue was partially offset by a $24.9 million impact from a lost
contract in Denmark. The Eastern North Sea's revenue decreased by $16.9 million
due to a contract expiry in Norway, which resulted in an $18.7 million decrease
in revenue that was partially offset by new contracts from an increase in oil
and gas activity in the region.

The Americas. The Americas contributed an additional $59.6 million in revenues,
due primarily to $72.1 million of revenue from new contracts for heavy
helicopters in Brazil combined with the deployment of all helicopters under
contracts entered into in Brazil in late fiscal 2012. These increases in Brazil
were partially offset by the expiry of some short-term contracts and by
decreases in North America from expired contracts.

Asia Pacific. Asia Pacific contributed an additional $41.2 million due primarily
to new contracts entered into at the end of fiscal 2012, where all helicopters
under such contracts were deployed in fiscal 2013. New contract wins in
Australia and East Timor increased revenue by $45.0 million over the prior year.

The revenue increases in Australia and East Timor were partially offset by a net
decrease of $7.8 million in Southeast Asia from expired contracts.

Africa-Euro Asia. Revenue decreased by $19.2 million, due primarily to the sale
of the fixed wing aircraft in Chad at the end of fiscal 2012 and our exit from
our relationship with our previous partner in Nigeria. We are in the process of
transitioning to new partners. In October 2012, we received our Nigerian AOC for
a single helicopter type and are in the process of setting up our interim base.

These decreases in revenue were partially offset by revenue increases in
Kazakhstan, Mozambique and Tanzania as increased oil and gas activities in these
areas generated new contracts.

Heli-One
Heli-One revenue decreased by $26.0 million due primarily to a decrease in
non-PBH project sales, including airframe, engine and component work. The
decrease in airframe, engine and component work was primarily attributable to
fewer airframe maintenance and modification projects completed during fiscal
2013.

Crew costs increased by $16.2 million to $429.2 million compared to fiscal 2012.

The increase was due primarily to additional crew costs for new and existing
contracts in Brazil, Australia, the United Kingdom, Mozambique, Kazakhstan and
Tanzania. These increases were offset by decreases in crew from expired
contracts and reduced flying hours in Denmark, Norway and Nigeria. Chad also had
a decrease in crew costs as we sold our fixed wing aircraft at the end of fiscal
2012. Crew costs were incurred only by our Helicopter Services segment.

Base operations and other costs decreased by $8.5 million to $366.0 million
compared to fiscal 2012. Base operations and other costs also included fuel
costs re-chargeable to our customers, insurance and travel. The majority of base
and operations and other costs related to our Helicopter Services segment, with
$29.9 million related to our Heli-One segment, which have decreased by $17.7
million compared with fiscal 2012. The decrease for Heli-One is due primarily to
other costs, where we had a sale of parts to a customer in fiscal 2012 that did
not reoccur in fiscal 2013. The decrease in base and other costs was partially
offset by new contracts in Brazil, Australia and the North Sea, which increased
the base set-up costs.

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Maintenance costs decreased by $27.7 million to $232.5 million compared to
fiscal 2012 due primarily to lower lease return costs being recorded in fiscal
2013, which are recorded when they are probable and can be estimated, usually
near the end of the helicopter lease term, the expiry of certain customer
contracts reducing activity and cost and the decrease in third-party non-PBH
sales. Maintenance costs were primarily related to our Helicopter Services
segment but are incurred by Heli-One, which conducts maintenance work for
Helicopter Services and also for external customers. Approximately two thirds of
these costs related to Helicopter Services.

Support costs increased by $4.4 million to $162.4 million compared to fiscal
2012 to support the centralized flying operations center in our Helicopter
Services segment and related consulting costs. The majority of support costs are
incurred by Helicopter Services, with $28.4 million related to our Heli-One
segment, which have decreased by $5.4 million compared with fiscal 2012 due to
lower consulting costs in this segment.

Helicopter Lease and Associated Costs
Helicopter leasing costs increased by $25.1 million to $201.7 million, due
primarily to an increase in new technologically advanced helicopter additions.

We are continuing to acquire new technologically advanced helicopters to meet
our customers' needs as they continue production, exploration and development
into deeper waters. We anticipate we will continue to finance helicopters
through operating leases and may make strategic decisions as required to
purchase certain helicopters outright. The purchase of helicopters allows for
greater jurisdictional flexibility as some lease agreements restrict the
movement of helicopters to certain countries.

General and Administration Costs
General and administration costs included in the results of the Corporate
Segment increased by $4.0 million to $74.1 million compared to fiscal 2012. The
increase is due primarily to $2.0 million in additional information technology
costs, $9.8 million of additional personnel support costs, consulting and
trainings costs partially offset by a $7.2 million decrease in insurance costs
as there were fewer reported claims in fiscal 2013. Information technology costs
increased as we incurred more training and consulting costs to support the
go-live of the new Heli-One integrated IT system in November 2012 and to support
other new global systems that are being implemented as part of the broad
transformation initiative. Personnel support costs have increased due primarily
to compensation costs where vacant roles have been filled.

Depreciation
Depreciation expense increased by $19.0 million to $131.9 million compared to
fiscal 2012, due primarily to an increase in the Heli-One segment of rotable
parts which can be repaired and re-used for several years to service the new
technologically advanced helicopters and an increase in helicopter depreciation
expense in the Helicopter Services segment. During fiscal 2013 we identified two
older helicopter types that would be exited. As part of this exit, we performed
an annual review of the useful lives of helicopters and reduced the useful lives
of these helicopters. This change in estimate resulted in an increase to
depreciation of $11.3 million in fiscal 2013. Of the fiscal 2012 depreciation
expense, $66.4 million related to Heli-One, $44.4 million related to Helicopter
Services and the remainder related to the Corporate Segment. Of the fiscal 2013
depreciation expense, $78.8 million related to Heli-One, $52.3 million related
to Helicopter Services and the remainder related to the Corporate Segment.

Restructuring Costs
Restructuring costs decreased by $11.5 million to $11.0 million compared to
fiscal 2012, due primarily to a decrease in initial costs associated with the
implementation of new systems and processes allowing for global standardization
in the Helicopter Services, Heli-One and Corporate Segments. Of our
restructuring costs in fiscal 2012, $17.8 million related to the Corporate
Segment, $4.5 million related to the Helicopter Services segment and $0.2
million related to the Heli-One segment. Of our restructuring costs in fiscal
2013, $6.8 million related to the Corporate Segment, $2.6 million related to the
Helicopter Services segment, and $1.6 million related to the Heli-One segment.

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Asset impairments
For the fiscal year ended Favorable
April 30, (Unfavorable)
(In thousands of U.S. dollars) 2012 2013 $ Change
Recovery (impairment) of receivables
and funded residual value guarantees $ 36 $ (1,671 ) $ (1,707 )
Impairment of assets held for sale (13,469 ) (12,164 ) 1,305
Impairment of assets held for use - (8,421 ) (8,421 )
Impairment of intangible assets (4,218 ) (7,725 ) (3,507 )
Total asset impairments $ (17,651 ) $ (29,981 ) $ (12,330 )
Asset impairments increased by $12.3 million to $30.0 million compared to fiscal
2012. Asset impairments include the impairment of receivables and funded
residual value guarantees, assets held for sale, assets held for use and
intangible assets. The increase in asset impairments related to the Helicopter
Services segment is due primarily to an increase of $8.4 million in impairment
of assets held for use and an increase of $3.5 million in intangible assets. The
impairment of assets held for sale increased compared to fiscal 2012 as there
are certain helicopter types we will be exiting once all the helicopters have
completed their flying obligations. The impairment of intangible assets
increased compared to fiscal 2012 as the impairment of embedded equity
recognized on leased helicopters was higher for our older technology helicopters
due to a decline in helicopter values. Of the fiscal 2012 asset impairments,
$17.4 million related to the Helicopter Services segment and $0.3 million
related to the Corporate Segment. Of the fiscal 2013 asset impairments, $29.9
million related to the Helicopter Services segment and $0.1 million related to
the Corporate Segment.

Loss on Disposal of Fixed Assets
Loss on disposal of fixed assets increased by $23.7 million to $15.5 million
compared to fiscal 2012 due primarily to an increase in the losses from the sale
and leaseback of helicopters in the Helicopter Services segment. Of the fiscal
2012 gain on disposal of fixed assets, $7.7 million related to the Helicopter
Services segment and $1.7 million related to the Corporate Segment, which were
partially offset by a loss of $(1.2) million related to the Heli-One segment. Of
the fiscal 2013 loss on disposal of fixed assets, $14.5 million related to the
Helicopter Services segment and $1.1 million related to the Heli-One segment,
which were partially offset by a gain of $0.1 million related to the Corporate
Segment.

Interest on Long-Term Debt
Interest on long-term debt increased by $10.6 million to $127.2 million compared
to fiscal 2012 due primarily to an increase in the interest expense on the
issuance of the $200.0 million in senior secured notes on October 5, 2012
partially offset by a decrease in capital lease interest expense as certain
capital leases were refinanced at the end of fiscal 2012 as operating leases.

Foreign Exchange Gains (Losses)
Foreign exchange gains decreased by $13.2 million to a foreign exchange loss of
$11.4 million compared to fiscal 2012 from the revaluation of net liability
positions denominated in U.S. dollars in entities with Norwegian Kroner and Euro
functional currencies as the U.S. dollar strengthened in fiscal 2013 relative to
those currencies as compared to the prior period.

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Income Tax Expense
Income tax expense increased by $6.2 million to $54.5 million compared to fiscal
2012. The effective tax rate for fiscal 2013 is (86.3)% compared to (151.2)% in
fiscal 2012. The below table provides a breakdown of the items which caused the
change in tax expense between fiscal 2013 and 2012:
Increase (decrease) Effective
(In millions of U.S. dollars) in tax expense tax rate
Income tax expense at April 30, 2012 $ 48.2 (151.2 )%
Non-deductible items 4.9
Functional currency adjustments 4.6
Valuation allowance 2.9
Rate differences in various jurisdictions and other (6.1 )
Income tax expense at April 30, 2013 $ 54.5 (86.3 )%
The increase in income tax expense as compared to fiscal 2012 is due primarily
to an increase in non-deductible items, functional currency adjustments and an
increase in the valuation allowance taken against deferred tax assets in certain
jurisdictions in the amounts indicated in the above table. Other items resulting
in a net decrease to tax expense of $6.1 million include rate differences in
various jurisdictions and an increase in non taxable income. The increase in non
-taxable income was as a result of restructuring certain intercompany debt. The
non­ deductible items increased by $4.9 million due to an increase in the
non-deductible interest expense incurred in certain jurisdictions. Income tax
expense increased by $4.6 million due to functional currency adjustments from
foreign currency gains related to tax balances denominated in Norwegian Kroner,
Euro and Canadian dollars in entities with a U.S. dollar functional currency as
the U.S. dollar weakened in fiscal 2013 relative to those currencies compared to
the prior period. The increase in the valuation allowance of $2.9 million
compared to the prior year was due to a change in our assessment of the future
realization of certain tax assets in fiscal 2013. This change in assessment
resulted in a change in the valuation allowance of $58.8 million. Of this
amount, $34.2 million was primarily in relation to deferred tax assets in the
U.S., Australia, Netherlands and Norway EHOB.

The effective tax rate is the ratio of income tax recovery (expense) to loss
from continuing operations before income tax. In addition to the impact on
income tax expense described in the preceding table, the reduction in the
negative effective tax rate from (151.2)% to (86.3)% resulted from an increase
in the net loss from continuing operations before income tax compared to the
prior year period without a corresponding change in income tax recovery
(expense) due to valuation allowances recorded against deferred income tax
assets in many jurisdictions. In addition, a significant component of income tax
expense for the 2013 fiscal year and the prior period is represented by income
taxes in certain jurisdictions, such as withholding taxes, which are not
directly correlated to movements in the net loss from continuing operations
before income tax. Furthermore, movements in our loss from continuing operations
may occur in jurisdictions where we are not recognizing the benefit of deferred
tax assets, which could result in no corresponding movement in our income tax
recovery (expense).

Non-Controlling Interest
Net earnings allocated to non-controlling interest decreased by $9.5 million to
$2.9 million, due primarily to a decrease in net earnings in EHOB from higher
income tax expense and the loss on the mark to market of derivatives which
relate to embedded foreign currency derivatives in some of our helicopter
services contracts. See Note 3 of our audited annual consolidated financial
statements for the fiscal years ended April 30, 2012, 2013 and 2014 included
elsewhere in this Annual Report on Form 10-K.

(ii) Adjusted EBITDAR margin is calculated as Adjusted EBITDAR divided by total
revenue less reimbursable revenue. Cost reimbursements from customers are
recorded as reimbursable revenue with the related reimbursement expense in
direct costs.

(iii) HE Rate is the third-party operating revenue from the Helicopter Services
segment excluding reimbursable revenue divided by a weighted average factor
corresponding to the number of heavy and medium helicopters in our fleet.

Our heavy and medium helicopters, including owned and leased, are weighted
at 100% and 50% respectively to arrive at a single HE count, excluding
helicopters expected to be retired from our fleet. An average of this
figure is used to calculate our HE Rate.

Helicopter Services Adjusted EBITDAR increased by $68.9 million to $469.7
million compared to fiscal 2012. The increase in Adjusted EBITDAR is due
primarily to the Americas, Asia Pacific, and the North Sea offset by Africa-Euro
Asia.

North Sea. The Western North Sea contributed an additional $9.5 million in
Adjusted EBITDAR due primarily to margins from new contracts in Scotland,
England and Ireland, which partially offset the margins from lost and expired
contracts. The Eastern North Sea contributed an additional $8.0 million in
Adjusted EBITDAR despite a net decrease in revenues due to lower compensation
costs in the region. The net improvement in the North Sea Adjusted EBITDAR
margin was 1.3% over the prior year.

The Americas. The Americas Adjusted EBITDAR increased by $24.3 million due
primarily to a $32.6 million increase in Brazil, where increased margins on new
heavy helicopter contracts combined with the deployment of additional
helicopters under contracts that began in April 2012. Brazil also had an
improvement in crew and helicopter availability that led to an increase in
Adjusted EBITDAR. This increased the Adjusted EBITDAR margin by 0.8% over the
prior year. These increases in the Americas' Adjusted EBITDAR were partially
offset by a $10.6 million decrease in North America Adjusted EBITDAR from
expired contracts which had a negative impact of 0.5% on Adjusted EBITDAR
margin.

Asia Pacific. Asia Pacific's increase in Adjusted EBITDAR of $23.3 million is
due primarily to the margins from new contracts being partially offset by higher
crew costs.

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Africa-Euro Asia. The Africa-Euro Asia region had a net decrease in Adjusted
EBITDAR of $2.8 million, due primarily to a $10.3 million decrease in Chad and
Nigeria, offset by a $14.1 million increase in Mozambique and Tanzania from an
increase in oil and gas activities that generated new contracts. Adjusted
EBITDAR has decreased in Chad as we sold our fixed wing aircraft at the end of
fiscal 2012 and we are continuing to incur costs while we transition our
Nigerian operations to our new partners. In October 2012, we received our
Nigerian AOC for a single helicopter type and are in the process of setting up
our interim base. The Adjusted EBITDAR margin increased by 0.2% as a result of
these changes.

Helicopter leasing costs for fiscal 2013 increased by $25.1 million to $201.7
million compared to fiscal 2012, due primarily to an increase in technologically
advanced helicopters additions that have higher lease costs partially offset by
a number of helicopters that were converted to capital leases during fiscal
2012. We are continuing to acquire technologically advanced helicopters to meet
our customers' needs as they continue exploration and development and production
into deeper waters. We anticipate we will continue to finance helicopters
through operating leases and may make strategic decisions as required to
purchase certain helicopters outright. The purchase of helicopters allows for
greater jurisdictional flexibility as some lease agreements restrict the
movement of helicopters to certain countries.

(ii) Adjusted EBITDAR margin is calculated as Adjusted EBITDAR divided by total
revenue less reimbursable revenue, of which there was none in the Heli-One
segment in fiscal 2012 and 2013.

Heli-One generates the majority of its revenue by supporting our Helicopter
Services Segment. Services to third parties represent 32.9% of its total
revenues. Adjusted EBITDAR decreased by $4.3 million to $91.7 million compared
to fiscal 2012 due primarily to a decrease in non-PBH revenues partially offset
by an increase in margins from internal PBH revenues and lower support costs.

Adjusted EBITDAR decreased by $17.5 million from lower non-PBH project sales as
compared to fiscal 2012. Despite the decreases from non-PBH sales, Adjusted
EBITDAR margin was marginally affected by a decrease of 0.4% due to our cost
savings from operational improvements compared to fiscal 2012. Adjusted EBITDAR
increased by $7.8 million compared to fiscal 2012 due to additional margins from
higher internal PBH revenues combined with lower maintenance costs due to the
timing of maintenance events with a favorable margin impact of 0.2%. Adjusted
EBITDAR increased by $5.4 million as compared to fiscal 2012 due to a decrease
in support costs from lower consulting costs resulting in a positive impact to
the Adjusted EBITDAR margin of 0.1%. Our Heli-One business is expected to
continue to expand its sales pipeline for non-PBH services and reduce costs and
inventory levels through the implementation of lean process techniques to drive
greater efficiencies in the workshops as part of our broad transformation
program.

Cash flows from operations, adjusted for non-cash items, decreased by $38.0
million, due to a higher net loss from operations, net of non-cash items, and
higher cash financing charges of $25.2 million, primarily due to the issuance,
by our wholly owned subsidiary CHC Helicopter S.A., of an additional $200.0
million in senior secured notes on October 5, 2012 and the $300.0 million of
senior unsecured notes issued on May 13, 2013. Cash flows from operations
benefited from favorable changes of $50.2 million in working capital compared to
fiscal 2013, which were driven by a decrease in receivables of $83.3 million, as
the result of collections, $15.0 million of higher deferred revenue, related to
contract activity where customers have made advance payments, offset by a $28.0
million decline in accounts payable and accruals, due to the timing of payments
with suppliers, including OEMs, an $8.3 million reduction in the net taxes
payable position, primarily due to cash payments for withholding taxes in
various jurisdictions, and a $4.3 million increase in prepaid expenses, related
primarily to the timing of certain license and insurance payments. Pension
contributions and benefits paid decreased slightly to $45.0 million, compared to
$46.7 million in fiscal 2013, due to the timing of funding contributions for our
funded and unfunded defined benefit pension plans in Canada, the UK, Norway and
the Netherlands. The higher payments for deferred lease financing costs were
incurred due to higher lease transaction activity in fiscal 2014.

One of our continued areas of focus is the improvement of our cash flows through
operational growth. We have implemented a number of initiatives, but have not
consistently decreased our use of cash in operations. No assurance can be given
that our efforts to reduce operational cash requirements, including continued
efforts to achieve greater cost efficiencies through our broad transformation
program, will be effective. The business may not generate sufficient net cash
from operating activities and future borrowings may not be available in amounts
sufficient to enable us to service our debt or to fund our other liquidity
needs. It is currently expected that the net cash from operating activities
will, together with our ability to access financing through our new revolving
credit facility, other financing markets, new operating leases and proceeds from
the sale of helicopters and other assets, be sufficient to meet the on-going
cash flow requirements. If we are unable to meet our debt obligations or fund
other liquidity needs, alternative financing plans may need to be undertaken,
such as refinancing or restructuring debt, selling assets, reducing or delaying
capital investments or raising additional capital. See Item 1A "Risk
Factors-Risks Related to Our Net Losses and Our Indebtedness-Our level of
indebtedness could affect our ability to raise additional capital to fund our
operations, limit our ability to react to changes in our business or our
industry and place us at a competitive disadvantage" in Part II below.

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Cash Flows Provided By Financing Activities
Cash flows provided by financing activities increased by $102.1 million to
$323.1 million compared to fiscal 2013, primarily due to proceeds from the
issuance, by our wholly owned subsidiary CHC Helicopter S.A., of $300.0 million
aggregate principal amount of senior unsecured notes on May 13, 2013 and from
the net proceeds of our IPO on January 17, 2014. On our IPO, we sold 31,000,000
ordinary shares to the public at an offer price of $10.00 per share. Our IPO
raised approximately $289.4 million, net of underwriting costs of $16.3 million
and other costs directly related to the IPO of $4.3 million. On February 20,
2014, the underwriters in our IPO exercised an option to purchase 3,000,000
ordinary shares at a price of $10.00 per share, raising approximately $28.4
million, net of underwriting costs of $1.6 million. In fiscal 2013, $202.0
million of senior secured notes were issued by one of our subsidiaries and no
share capital was issued.

This net increase over fiscal 2013 was partially offset by an increase in
repayments net of draws on the revolving credit facility, related party loans
repayments, and redemptions made of our senior secured notes. The net repayments
on our senior secured revolving credit facility increased by $120.2 million over
fiscal 2013, with a portion of the net proceeds from the IPO being used to repay
the borrowings under this facility on January 23, 2014. In addition, on February
7, 2014, one of our subsidiaries redeemed $130.0 million of the senior secured
notes at a redemption price of 103%, for an amount of $133.9 million, excluding
accrued interest. There was also a net decrease to cash flows from higher
deferred financing costs of $10.3 million, related to the issuance, by our
wholly owned subsidiary CHC Helicopter S.A., of $300.0 million aggregate
principal amount of senior unsecured notes issued on May 13, 2013, and a new
senior secured revolving credit facility arrangement entered into on January 23,
2014, as described below under "Sources of Liquidity".

The related party loan transactions reflect the borrowing and repayment of loans
to companies under the common control of our majority shareholder and are
described in Note 22 of the annual audited consolidated financial statements for
the fiscal years ended April 30, 2012, 2013 and 2014, included elsewhere in this
Annual Report on Form 10-K.

Cash Flows Used In Investing Activities
Cash flows used in investing activities decreased by $11.3 million to $140.6
million compared to fiscal 2013, due primarily to an increase on proceeds
received from the disposal of property and equipment of $264.9 million,
primarily related to sale and leaseback financing, offset by higher property and
equipment additions of $218.9 million. Proceeds from the disposal of property
and equipment primarily increased in fiscal 2014, due to a higher level of sale
and leaseback activity, which increased from 22 in fiscal 2013 to 40 in fiscal
2014. Property and equipment additions increased due to a higher level of lease
buyout and helicopter purchase activity compared to fiscal 2013. In addition,
there was an increase in cash outflows of $40.8 million from a higher level of
helicopter deposits in fiscal 2014 compared to fiscal 2013. During fiscal 2014,
our additions related to buildings and other, primarily from investment in the
construction of buildings located in Poland, for our MRO segment and in Brazil,
for our Helicopter Services segment.

For the Fiscal Years Ended April 30, 2012 and April 30, 2013
Cash Flows Provided By Operating Activities
Cash flows provided by operating activities decreased by $15.5 million to a $1.2
million provision of cash compared to fiscal 2012 as operational improvements of
$48.7 million were more than offset by an unfavorable movement in operating
assets and liabilities of $47.5 million, an increase in interest expense of
$10.6 million and pension contributions of $2.2 million. The unfavorable
movement in operating assets and liabilities was due primarily to an increase in
accounts receivable of $55.3 million and inventory of $18.2 million. Accounts
receivable have increased due to an increase in the time to collect receivables
compared to fiscal 2012, while inventory increased in fiscal 2013 to allow for
larger purchase discounts and to support our improved helicopter availability.

These increases in the use of cash were offset by our accounts payable and
accruals, which increased by $21.7 million compared to fiscal 2012 due to the
timing of supplier payments at the end of fiscal 2013 and deferred revenue by
$5.4 million. Interest expense increased by $10.6 million due primarily to the
additional interest paid in fiscal 2013 on our $200.0 million in senior secured
notes issued in October 2012 offset in part by a decrease in interest paid on
capital lease obligations due to lease refinancings. Cash pension contributions
increased due primarily to the funding of our Norwegian pension plan.

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Cash Flows Provided By Financing Activities
Cash flows provided by financing activities increased by $13.8 million to $221.0
million compared to fiscal 2012, due primarily to the net proceeds from the
issuance of $200.0 million in additional senior secured notes which was
partially offset by a decrease in proceeds from the issuance of capital stock in
fiscal 2012 of $100.0 million that did not reoccur in fiscal 2013, an increase
in net debt payments from increased borrowings under our existing senior secured
revolving credit facility and a decrease in the securitization accounts
receivable from the timing of funding. We also received a related party loan of
$25.0 million during fiscal 2013.

On October 5, 2012, our wholly owned subsidiary, CHC Helicopter S.A. issued an
additional $200.0 million of senior secured notes, which increased our overall
liquidity. The gross proceeds from the senior secured notes of $202.0 million
were used to repay a portion of the outstanding borrowings under our existing
senior secured revolving credit facility. We also incurred financing fees of
$4.0 million, which are being amortized over the term of the senior secured
notes. These senior secured notes were issued as "additional notes" under the
same indenture that governs the $1.1 billion of senior secured notes which were
previously issued by CHC Helicopter S.A. in October 2010. The senior secured
notes are guaranteed by us and by certain direct and indirect restricted
subsidiaries in the Security Jurisdictions existing on the date of issuance. The
additional senior secured notes have an aggregate principal amount of $200.0
million, were issued at 101.0%, bear interest at an annual rate of 9.25% with
semi-annual interest payments due on April 15 and October 15 and mature on
October 15, 2020.

Cash Flows Used In Investing Activities
Cash flows used in investing activities decreased by $66.8 million to $152.0
million compared to fiscal 2012, due primarily to an increase in proceeds on
disposal of property and equipment of $135.1 million offset by an increase in
property and equipment additions of $51.3 million and an increase in helicopter
deposits, net of lease inceptions of $24.4 million. The increase in the proceeds
from the disposal of property and equipment was due primarily to an increase in
the number of helicopters that were the subject of sale and lease back
transactions from 12 in fiscal 2012 to 22 in fiscal 2013. Helicopter deposits
increased due to our advance deposits for the purchase of the technologically
advanced helicopters.

Liquidity and Sources of Liquidity
At April 30, 2014, our liquidity totaled $650.7 million, which was comprised of
cash and cash equivalents of $302.5 million, unused capacity in the revolver of
$320.1 million, net of letters of credit of $54.9 million, plus undrawn
overdraft facilities of $28.1 million.

Our cash requirements include our normal operations as well as our debt and
other contractual obligations as discussed under the caption "Future Cash
Requirements" below. On May 13, 2013, our wholly-owned subsidiary CHC Helicopter
S.A. issued an aggregate principal amount of $300.0 million of senior unsecured
notes at par value, bearing interest at an annual rate of 9.375% with
semi-annual interest payments on June 1 and December 1 and mature on June 1,
2021. The senior unsecured notes are guaranteed by us and certain direct and
indirect wholly-owned subsidiaries on a joint and several basis. The net
proceeds from the notes were used to repay the borrowings under our senior
secured revolving credit facility and to fund general working capital
requirements. The $300.0 million unsecured senior notes issued on May 13, 2013
have increased annual cash requirements by approximately $28.1 million due to
the additional interest payment obligations.

On February 7, 2014, one of our subsidiaries redeemed $130.0 million of the $1.3
billion of our senior secured notes, which bear interest at a rate of 9.25%.

This will reduce our annual cash requirements by approximately $12.0 million.

Subsequent to April 30, 2014, in May 2014, one of our subsidiaries purchased an
additional $65.0 million of the senior secured notes in the open market at
premiums ranging from 8.00% to 9.13%. This will further reduce our annual cash
requirements by approximately $6.0 million.

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The ability to satisfy long-term debt obligations, including repayment of
principal and interest will depend on future performance, which is subject to
general economic conditions and other factors, some of which are beyond our
control. We expect our earnings and cash flow to vary significantly from year to
year due to the cyclical nature of the industry. As a result, the amount of debt
that can be managed in some periods may not be appropriate in other periods. In
addition, future cash flows may be insufficient to meet debt obligations and
commitments, including the notes, and revolving credit facility. Any
insufficiency could negatively impact the business. In addition, the indenture
governing the notes allows us to incur additional indebtedness. The incurrence
of additional indebtedness could negatively affect the repayment of principal
and interest on the debt, including the notes. We may face delays in obtaining
cash from our subsidiaries in certain jurisdictions to fund future cash
requirements due to central banking legislation or other regulations in these
jurisdictions. These restrictions have not and are not expected to have an
impact on our ability to meet our obligations. We believe that our existing and
future cash flows, as well as our ability to access financing through the
revolving line of credit, other financing markets, new operating leases and
proceeds from the sale of helicopters and other assets are sufficient to meet
our on-going cash flow requirements. Similarly, we expect that our
transformation program will generate new initiatives to create greater
liquidity. However, our earnings have been insufficient to cover our fixed
charges since 2008. If cash flow from operations is insufficient to satisfy the
debt obligations, alternative financing plans may need to be undertaken, such as
refinancing or restructuring the debt, selling assets, reducing or delaying
capital investments or raising additional capital or indebtedness. Any
alternative financing plans that may be undertaken by us, if necessary, may not
be sufficient to meet our debt obligations. Our inability to generate sufficient
cash flow to satisfy our debt obligations, including obligations under the
notes, or to obtain alternative financing, could materially and adversely affect
our business, financial condition, results of operations and prospects. See
Item 1A "Risk Factors-Our indebtedness and lease obligations could adversely
affect our business and liquidity position".

Sources of Liquidity
On October 5, 2012, we issued an additional $200.0 million of senior secured
notes. The additional senior secured notes were issued under the same indenture
that governs the $1.1 billion of senior secured notes which were previously
issued in October 2010. The additional senior secured notes with an aggregate
principal value of $200.0 million were issued at 101.0% of par value, bear
interest at an annual rate of 9.25%, with semi-annual interest payments on
April 15 and October 15, and mature on October 15, 2020. The gross proceeds from
the senior secured notes of $202.0 million were used to repay a portion of the
outstanding borrowings under our senior secured revolving credit facility. We
also incurred financing fees of $3.8 million to be amortized over the term of
the senior secured notes.

On May 13, 2013, our wholly owned subsidiary CHC Helicopter S.A issued an
aggregate principal amount of $300.0 million of senior unsecured notes at par
value, bearing interest at an annual rate of 9.375% with semi-annual interest
payments due on June 1 and December 1 and mature on June 1, 2021. The senior
unsecured notes are guaranteed by us and certain direct and indirect
wholly-owned subsidiaries on a joint and several basis. The net proceeds from
the notes were used to repay the borrowings under our senior secured revolving
credit facility. We also incurred financing fees of approximately $6.0 million,
which will be amortized over the term of the senior unsecured notes. We issued
ordinary shares for net cash proceeds of $317.8 million as part of our IPO on
the New York Stock Exchange and subsequent exercise of an option to purchase
additional shares by the underwriters. A portion of the net proceeds from the
offering were used to repay the borrowings under our senior secured revolving
credit facility on January 23, 2014. On February 7, 2014, one of our
subsidiaries redeemed $130.0 million of the $1.3 billion of our senior secured
notes. As a result of this redemption, we incurred a loss on extinguishment of
$7.7 million.

On January 23, 2014 we entered into a new revolving credit facility for $375.0
million held by a syndicate of financial institutions for a term of five years
and bearing interest at the Alternate Base Rate, LIBOR, Canadian Prime Rate,
CDOR or EURIBOR, plus an applicable margin that ranges from 3.50% to 4.50%,
subject to a leverage-based step-down of 0.75%. The new revolving credit
facility is secured on a priority basis and ranks equally with the senior
secured note holders except for payments upon enforcement and insolvency, where
the revolving credit facility will rank before the senior secured note holders.

The senior secured notes and new revolving credit facility are guaranteed on a
first-priority lien basis by most of our subsidiaries on a joint and several
basis. For information about the financial position and results of operations of
our guarantor subsidiaries, see Note 27 of our audited annual consolidated
financial statements for the fiscal years ended April 30, 2012, 2013 and 2014
included elsewhere in this Annual Report on Form 10-K.

To assist with future growth opportunities, a key initiative of our
transformation program is to create greater liquidity through the implementation
of new cost control measures such as optimizing the procurement of capital
expenditures and inventory, working capital improvements and optimization of
customer contracts and improved profit growth. We continue to review and
evaluate our long-term capital structure in accordance with our strategic goals.

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Future Cash Requirements
Contractual Obligations and Off-Balance Sheet Arrangements
The following table summarizes the contractual obligations and other commercial
commitments on an undiscounted basis as of April 30, 2014 and the period that
the contractual obligation or commitment is expected to be settled in cash.

(ii) Interest on variable rate debt was estimated based on applicable forward
rates as of April 30, 2014.

(iii) Includes $65.0 million of the senior secured notes outstanding at April
30, 2014, which were repurchased in May 2014.

(iv) See "Operating Lease Commitments" below for further information.

(v) We have a fifteen year master training services agreement with CAE commits
us to annual minimum training purchases.

(vi) Pension obligations represent estimated contributions of $45.7 million to
our defined benefit pension plans in the U.K., Netherlands and Norway
during fiscal 2015 and a contractual obligation with the U.K. pension plan
to contribute £6.0 million per annum from fiscal 2016 until mid-fiscal
2020. Due to the potential impact of future plan investment performance,
changes in interest rates, wage rates, changes in other economic and
demographic assumptions and changes in legislation in foreign
jurisdictions, we are not able to reasonably estimate the timing and
amount of contributions that may be required to fund our Norway and
Netherlands defined benefit pension plans for periods beyond fiscal 2015.

Operating Lease Commitments
We entered into helicopter operating leases with 21 lessors in respect of 171
helicopters included in our fleet as of April 30, 2014. As of April 30, 2014,
these leases had expiry dates ranging from fiscal 2015 to 2024. We have the
option to purchase the majority of the helicopters for agreed amounts that do
not constitute bargain purchase options, but have no commitment to do so. With
respect to such leased helicopters, substantially all of the costs of major
inspections of airframes and the costs to perform inspections, major repairs and
overhauls of major components are at our expense. We either perform this work
internally through our own repair and overhaul facilities or have the work
performed by an external repair and overhaul service provider.

At April 30, 2014, we have commitments with respect to operating leases for
helicopters, buildings, land and equipment. The net present value of our
operating lease commitments at April 30, 2014 was $1,238.5 million. We have
calculated the net present value based on our minimum lease payments, excluding
any contingent rentals, using a 9.0% discount rate. For more information on our
commitments, see Note 23 of our annual audited consolidated financial statements
for the fiscal years ended April 30, 2012, 2013 and 2014 included elsewhere in
this Annual report on Form 10-K. For helicopter leases expiring in the next
twelve months, where we have the option to refinance these leases, purchase the
helicopters or return the helicopters under the agreement terms.

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The terms of certain of the helicopter lease agreements impose operating and
financial limitations on us. Such agreements limit the extent to which we may,
among other things, incur indebtedness and fixed charges relative to our level
of consolidated adjusted earnings before interest, taxes, depreciation and
amortization.

Generally, in the event of a covenant breach, a lessor has the option to
terminate the lease and require the return of the helicopter, with the repayment
of any arrears of lease payments plus the present value of all future lease
payments and certain other amounts, which could be material to our financial
position. The helicopter would then be sold and the surplus, if any, returned to
us. Alternatively, we could exercise our option to purchase the helicopter.

Other Commitments
As of April 30, 2014, we have committed to purchase 28 new helicopters. The
total required additional expenditures related to these purchase commitments are
approximately $688.2 million. These helicopters are expected to be delivered in
fiscal 2015 ($351.4 million), 2016 ($251.9 million) and 2017 ($84.9 million) and
will be deployed in the Company's Helicopter Services segment. Additionally, we
have committed to purchase $61.4 million of helicopter parts by October 31, 2015
and $100.0 million of heavy helicopters from Airbus Helicopters prior to
December 31, 2016.

Variable Interest Entities
The Company has variable interest in entities that are not consolidated, as we
are not the primary beneficiary, which provide operating lease financing to us
and an entity that provides flying services to third party customers. At
April 30, 2014, the Company had operating leases for 90 helicopters with
variable interest entities that were not consolidated. See Note 3 of the audited
annual consolidated financial statements for the fiscal years ended April 30,
2012, 2013 and 2014 included elsewhere in this Annual Report on Form 10-K.

Guarantees
The Company has provided limited guarantees to third parties under some of its
operating leases relating to a portion of the residual helicopter values at the
termination of the leases. The leases have terms expiring between fiscal 2015
and 2024. At April 30, 2014, the Company's exposure under the asset value
guarantees including guarantees in the form of funded and unfunded residual
value guarantees, rebateable advance rentals and deferred payments is
approximately $245.2 million.

Contingencies
The Company has exposure for certain legal matters as disclosed in Note 24 to
the annual consolidated financial statements for the year ended April 30, 2014
included elsewhere in this Annual Report on Form 10-K. There have been no
material changes in our exposure to contingencies.

Covenants and Adjusted EBITDA
The Company's senior secured notes, senior unsecured notes, new revolving credit
facility, other long-term debt obligations and certain helicopter lease
agreements impose operating and financial limitations on the Company through
financial covenants, which among other things, limit the ability to incur
additional indebtedness, create liens, sell or sublease assets, engage in
mergers or acquisitions and make dividend and other payments.

Contractual Adjusted EBITDA is a non-GAAP financial measure which is calculated
based on the consolidated results of CHC Group Ltd. and on the consolidated
results our subsidiary 6922767 Holding S.à.r.l. in order to satisfy the
requirements of our obligations under the above noted arrangements. Contractual
Adjusted EBITDA is calculated by adding to or subtracting from the consolidated
net earnings (loss) of CHC Group Ltd and our subsidiary 6922767 Holding
S.à.r.l., certain of the adjustment items permitted in calculating covenant
compliance under the applicable indenture governing our senior secured notes,
our senior unsecured notes and our existing senior secured revolving credit
facility. We describe these adjustments to net earnings (loss) in the table
below. Contractual Adjusted EBITDA is a supplemental measure of our ability to
service indebtedness that is not required by, or presented in accordance with,
U.S. GAAP.

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Contractual Adjusted EBITDA is not a measurement of our financial performance
under U.S. GAAP and should not be considered as an alternative to net earnings
(loss) or other performance measures derived in accordance with U.S. GAAP, or as
an alternative to cash flow from operating activities as a measure of our
liquidity. In addition, Adjusted EBITDA as presented herein may not be
comparable to similarly titled measures of other companies. We use Contractual
Adjusted EBITDA as a measure to calculate certain financial covenants related to
our new revolving credit facility, the senior secured notes indenture and the
senior unsecured notes indenture. Under the new revolving credit facility
agreement, the Company must maintain a ratio of 2.5 to 1 or less of first
priority net debt as defined in the new revolving credit facility agreement to
Contractual Adjusted EBITDA. If the financial covenant is not maintained,
repayment of the new revolving credit facility can be accelerated. Under the new
revolving credit facility agreement, senior secured notes indenture and senior
unsecured notes indenture, the Company must meet certain Contractual Adjusted
EBITDA ratios to incur additional indebtedness above the permitted indebtedness
as defined in the new revolving credit facility agreement, senior secured notes
indenture and senior unsecured notes indenture. To incur additional indebtedness
which is not otherwise permitted, the Company must have a Contractual Adjusted
EBITDA to fixed charges ratio as defined in the new revolving credit facility
agreement, senior secured notes indenture and senior unsecured notes indenture
that is equal to or greater than 2.0 to 1.0. However, if the indebtedness is
secured by a lien then the Company must also have a total secured indebtedness,
net of cash, to Contractual Adjusted EBITDA ratio as defined in the revolving
credit facility agreement and notes indenture that is less than or equal to 5.0
to 1.0.

Contractual Adjusted EBITDA has limitations as an analytical tool, and you
should not consider such measure either in isolation or as a substitute for net
earnings (loss), cash flow or other methods of analyzing our results as reported
under U.S. GAAP. Some of these limitations are:
• Contractual Adjusted EBITDA does not reflect changes in, or cash
requirements for, our working capital needs;
• Contractual Adjusted EBITDA does not reflect the cash
requirements necessary to service principal payments on our
indebtedness;
• Contractual Adjusted EBITDA does not reflect the cash
requirements to pay our taxes;
• Although depreciation and amortization are non-cash charges, the
assets being depreciated and amortized will often have to be
replaced in the future, and Contractual Adjusted EBITDA does not
reflect any cash requirements for such replacements; and
• Contractual Adjusted EBITDA is not adjusted for all cash and
non-cash income or expense items that are reflected in our
statements of cash flow.

Because of these limitations, Contractual Adjusted EBITDA should not be
considered as discretionary cash available to us to reinvest in the growth of
our business or as a measure of cash that will be available to us to meet our
obligations.

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Set forth below is a reconciliation of net loss to Contractual Adjusted EBITDA
derived from the consolidated financial statements of CHC Group Ltd. and from
the consolidated financial statements of our subsidiary 6922767 Holding S.à.r.l.

for the fiscal year ended April 30, 2014. As of April 30, 2014, we were in
compliance with all financial covenants contained in the agreements governing
our outstanding indebtedness.

(f) This is an adjustment to arrive at the current service cost of the pension.

(g) This is a pro-forma adjustment resulting from the capitalization of certain
operating leases.

(h) Contractual Adjusted EBITDA for the periods presented does not include the
pro forma effect of helicopter acquisitions or disposals. However, the new
revolving credit facility and the applicable indenture governing the senior
secured notes and the senior unsecured notes permit us to calculate
Contractual Adjusted EBITDA for purposes of the applicable covenants
contained therein, giving pro forma effect to helicopter acquisitions, net of
disposals.

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Critical Accounting Policies and Estimates
The preparation of the financial statements requires management to make
estimates and assumptions that affect the reported amounts of assets and
liabilities and disclosure of contingent assets and liabilities at the dates of
the financial statements and the reported amounts of revenue and expenses during
the reporting periods. Areas where significant estimates and assumptions have
been made include: classification of helicopter operating leases, consolidation
of variable interest entities, property and equipment, goodwill, intangible and
other long-lived asset impairment, pension benefits, contingent liabilities,
income taxes and stock-based compensation.

Classification of helicopter operating leases
In assessing the lease classification of a helicopter operating lease,
management makes significant judgments and assumptions in determining the
discount rate, fair value of the helicopter, estimated useful life and residual
value. Changes in any of these assumptions at the lease inception or
modification date could change the initial classification of the lease.

Consolidation of variable interest entities ("VIEs")
We are required to consolidate a VIE if we are determined to be its primary
beneficiary. Significant judgments are made in assessing whether we are the
primary beneficiary, including determination of the activities that most
significantly impact the VIE's economic performance. This significant judgment
is discussed further in Note 3 of our audited annual consolidated financial
statements for the fiscal years ended April 30, 2012, 2013 and 2014 included
elsewhere in this Annual Report on Form 10-K.

Property and equipment
Flying assets are amortized to their estimated residual value over their
estimated service lives using the straight-line method. The estimated service
lives and associated residual values are based on management estimates including
an analysis of future values of the helicopters and our experience. The
estimated service lives and associated residual values of helicopters are
reviewed when there are indicators that a change in estimate may be necessary.

During the year ended April 30, 2013 a review was performed of the estimated
service lives of helicopters and the estimated service life of certain
helicopter types that we will be exiting was reduced to 10 years. The change in
estimate increased depreciation and decreased property and equipment by $11.3
million in the year ended and as of April 30, 2013 respectively.

In addition, we review the carrying amounts of the property and equipment either
on an annual basis or earlier when the asset is classified as held for sale or
when events or circumstances indicate that the carrying amount of an asset may
not be recoverable from the estimated future cash flows expected to result from
its use and eventual disposition.

Long-lived assets that have been classified as held for sale are measured at the
lower of their carrying amount or fair value less costs to sell and are not
amortized once they are classified as held for sale. An impairment loss is
recognized as the excess of the carrying amount over the fair value less costs
to sell.

In the years ended April 30, 2012, April 30, 2013 and April 30, 2014, we
recorded impairment charges of $13.5 million, $12.2 million and $18.5 million on
assets classified as held for sale.

Where events or circumstances indicate that the carrying amount of held for use
assets may not be recoverable, the carrying value of the assets or asset groups
is compared to the future projected undiscounted cash flows. We estimate the
future projected undiscounted cash flows for helicopters at the helicopter type
level as this is the lowest level which earns independent cash flows. The cash
flows are based on management's expectation of future revenues and expenses
including costs to maintain the assets over their respective service lives.

Revenues are derived from the contracts for each helicopter. Costs are based on
the budgeted amounts for crew, helicopter lease costs, insurance, PBH,
consignment inventory and any other cost directly related to the operation of
the helicopter. An impairment loss is recognized as the excess of the carrying
value over the fair value when an asset or asset group is not recoverable. Fair
value is based on third party appraisals. Significant estimates and judgments
are applied in determining these cash flows and fair values.

For the year ended April 30, 2012, no impairment testing was performed as there
were no indicators of impairment identified. For the year ended April 30, 2013
and April 30, 2014, $8.4 million and $5.5 million of impairment on assets held
for use was recognized, as their carrying values were not deemed to be
recoverable as a strategic decision was made to exit certain helicopter types
upon completion of their flying obligations.

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Goodwill and intangible asset impairment
Embedded Equity
Embedded equity in helicopter lease contracts was recognized on our acquisition
of CHC Helicopter Corporation, and represents the excess of the market price of
the helicopters on the date of acquisition over the fixed lease buyout prices
contained in certain helicopter operating leases.

We review the carrying amounts of the embedded equity in helicopter leases
(intangible asset) on an ongoing basis to determine if the carrying amount is
recoverable.

In testing the recoverability of embedded equity, the costs to buyout the lease
is compared to the fair value of the helicopter. An impairment loss is
recognized as the excess of the costs to buyout the lease over the fair value
and is applied first to the embedded equity and then to the funded residual
value guarantee. Fair value is based on third party appraisals.

We recorded impairment charges of $4.2 million, $7.7 million and $0.9 million to
write down a portion of our embedded equity to fair value for the years ending
April 30, 2012, 2013 and 2014, respectively. The impairments are due to the fair
value of the helicopters declining from when the embedded equity was first
recognized on our acquisition of CHC Helicopter Corporation.

Goodwill, Trade names and Trademarks
The recoverability of goodwill and indefinite life intangible assets is assessed
on an annual basis or more frequently if events or circumstances indicate that
the carrying value may not be recoverable. Goodwill is assessed for impairment
at the reporting unit level by comparing the carrying value of the reporting
units with their fair value.

The fair value of our reporting units is determined based on the present value
of estimated future cash flows, discounted at a risk-adjusted rate. Management's
forecasts of future cash flows which incorporate anticipated future revenue
growth and related expenses to support the growth and maintain its assets are
used to calculate fair value. The discount rates used represent management's
estimate of the weighted average cost of capital for the reporting units
considering the risks and uncertainty inherent in the cash flows of the
reporting units and in our internally developed forecasts.

At February 1, 2012, February 1, 2013 and February 1, 2014, we performed our
annual impairment test of goodwill. All of our goodwill is contained in the
Helicopter Services reporting unit. No impairment has been recognized in the
years ended April 30, 2012, April 30, 2013 and April 30, 2014 as the fair value
of this reporting unit exceeded its carrying amount by a minimum of $400.0
million in each of the three years. In the event that the carrying value
exceeded the fair value, we would have performed the second step in the two step
impairment test to determine the amount of the impairment loss.

The fair value of our reporting units is most significantly affected by the
discount rate used, the expected future cash flows and the long-term growth
rate. We operate in a competitive environment and derive a significant portion
of revenue from the offshore oil and gas industry. The ability to win new
contracts, earn forecast margins on those contracts, retain existing customers
as well as the continued demand for flying services in the oil and gas market
will affect our future cash flows and future growth. Relatively minor changes in
future cash flows, growth rates and discount rates could significantly affect
the estimate of reporting unit fair value and the amount of impairment loss
recognized, if any.

If the discount rates used in our goodwill impairment test were to increase by
0.5% the fair value of the reporting unit would have decreased by $135.4
million, $138.9 million and $127.2 million as of February 1, 2012, February 1,
2013 and February 1, 2014 respectively.

If the margins used in our goodwill impairment test, calculated using Adjusted
EBITDAR less helicopter lease and associated costs, were to decrease by 0.5% the
fair value of the reporting unit would have decreased by $86.6 million, $109.0
million and $116.6 million as of February 1, 2012, February 1, 2013 and February
1, 2014 respectively.

The fair value of trademarks and trade names is determined based on the present
value of estimated future cash flows, discounted at a risk-adjusted rate. No
impairment has been recognized in the years ended April 30, 2012, April 30, 2013
and April 30, 2014 for trademarks and trade names as the discount rate for the
carrying value to exceed the fair value of the trademarks of Helicopter Services
would be 28.6%, 32.1% and 35.5%, respectively, and Heli-One would be 55.1%,
56.0% and 59.8%, respectively.

Approximately 28% of our active employees are covered by defined benefit pension
plans. As of April 30, 2013 and 2014, we had an unfunded deficit of $87.7
million and $76.6 million. The pension expense (income) for fiscal 2012, 2013
and 2014 was $15.6 million, $7.4 million and $(0.9) million. The overall asset
mix was 28% equities, 46% fixed income and 26% money market as of April 30,
2014. This asset mix varies by each plan.

Measuring our obligations under the plans and related periodic pension expense
involves significant estimates. Our pension benefit costs are accrued based on
our review of annual analyses performed by our actuaries. These factors include
assumptions about the rate at which the pension obligation is discounted, the
expected long-term rate of return on plan assets, the rate of future
compensation increases and mortality rates. Both the discount rate and expected
rate of return on plan assets require estimates and projections by management
and can fluctuate from period to period. We have determined the discount rate
using market based data in consultation with our actuaries. For the defined
benefit pension plan of the United Kingdom the expected long-term rate of return
on plan assets reflects the investment objective of 3.7% over a proxy return on
a matching asset to the liabilities of the plan provided to the two investment
advisors who manage the investment portfolio. For the defined benefit pension
plans of the Netherlands and Norway the overall expected long-term rates of
return on plan assets have been determined in part by assessing current and
expected asset allocations as well as historical and expected returns on various
categories of the assets. Such expected rates of return ignore short-term
fluctuations. We believe these assumptions are appropriate based upon the mix of
the investments and the long-term nature of the plans' investments.

The weighted average discount rate of the various pension plans used to
determine the pension benefit obligation and expense was 4.06% as of April 30,
2013 and 4.11% as of April 30, 2014.

The calculation of the estimate of the expected long-term rate of return on
assets and additional discussion regarding pension and other post-retirement
plans is described in Note 18 -Employee pension plans to our audited
consolidated financial statements for the fiscal years ended April 30, 2012,
2013 and 2014 included elsewhere in this Annual Report on Form 10-K. The
weighted average expected long-term rate of return on assets associated with our
pension benefits was 6.72% at April 30, 2013 and 6.57% at April 30, 2014. The
expected return on assets is a long-term assumption whose accuracy can only be
measured over a long period based on past experience.

The pension income for the year ended April 30, 2014 was $(0.9) million. An
increase in the expected long-term return on plan assets or the discount rate
would reduce pension plan expense (income), and vice versa. As an indication of
the sensitivity of pension expense to the long-term rate of return assumption, a
1% decrease in this assumption would have decreased pension income for 2014 by
approximately $7.3 million.

The actuarial assumptions used to determine pension benefits may differ from
actual results due to changing market and economic conditions, higher or lower
withdrawal rates or longer or shorter life spans of participants. Differing
estimates may have a material impact on the amount of pension expense recorded
and on the carrying value of prepaid pension costs and accrued pension
obligations.

Contingent liabilities
We are subject to a variety of claims, lawsuits and investigations in the
ordinary course of business as discussed in Note 24 to our audited annual
consolidated financial statements for the fiscal years ended April 30, 2012,
2013 and 2014 included elsewhere in this Annual Report on Form 10-K. We
determine whether an estimated loss from a contingency should be accrued by
assessing whether a loss is deemed probable and can be reasonably estimated.

Estimating liabilities and costs associated with these matters requires judgment
and assessment based upon professional knowledge, experience of management and
our internal and external legal counsel.

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Income taxes
We are subject to taxes in numerous foreign jurisdictions. Income and other tax
risks recognized in the Consolidated Financial Statements reflect management's
best estimate of the outcome based on the facts known at the balance sheet date
in each individual country. These facts may include, but are not limited to,
change in tax laws and interpretation thereof in the various jurisdictions where
the Company operates. They may have an impact on the income tax as well as the
resulting assets and liabilities. Any differences between tax estimates and
final tax assessments are charged to the statement of operations in the period
in which they are incurred.

In addition, our business and operations are complex and include a number of
significant financings, acquisitions and dispositions. The determination of
earnings, payroll and other taxes involves many factors including the
interpretation of tax legislation in multiple jurisdictions in which we are
subject to ongoing tax assessments. When applicable, we adjust the previously
recorded income tax expense, direct costs, interest and the associated assets
and liabilities to reflect its change in estimates or assessments. These
adjustments could materially change our results of operations.

We have assessed the realization of the deferred income tax asset (net of
allowance) related to income tax losses as more likely than not that the asset
will be realized. Judgment is required in determining whether the deferred tax
assets will be realized in full or in part. At April 30, 2014, we had a
valuation allowance of $250.8 million. The realization of the deferred tax asset
was based on assumptions regarding the reversal of existing future tax
liabilities and future earnings levels in the subsidiaries with accumulated
losses, and an ability to implement tax planning measures. If, in the future, it
is determined that it is more likely than not that all or part of the deferred
tax asset will not be realized, a charge will be made to earnings in the period
when such determination is made.

Stock-based compensation
On December 16, 2013, our Board of Directors adopted a new equity compensation
plan which permits us to grant non-qualified stock options, incentive stock
options, share appreciation rights, restricted shares, restricted share units,
other share based awards and performance compensation awards to certain eligible
directors, officers, employees, consultants or advisors of the Company and its
affiliates termed the CHC Group Ltd. 2013 Omnibus Incentive Plan ("2013
Incentive Plan"). This plan is in addition to our 2011 Management Equity Plan
("2011 Plan") which 6922767 Holding (Cayman) Inc., our parent ("the Parent")
adopted. The terms of the plans are described in Note 17 of our annual audited
consolidated financial statements for the fiscal years ended April 30, 2012,
2013 and 2014 included elsewhere in this Annual Report on Form 10-K.

The fair value of the stock options, service vesting stock options, the share
price performance options and the share price performance shares under the 2013
Incentive Plan were estimated using a Binomial model, due to the need to
consider various exercise scenarios under these awards. The key factors that
will create value in these awards include the (1) expected term of the awards
(2) the risk-free interest rate, which is based on the U.S. Treasury yield curve
in effect at the time of grant with maturities equal to the grant's expected
life (3) volatility, which has been estimated using historical volatility of the
peer companies' in the S&P 500 Energy Index and two additional peer companies'
stock prices and (4) the expected dividend rate, which for granted awards was
estimated as nil. If any of the assumptions used in the Binomial model changes
significantly, stock-based compensation for future awards may differ materially
compared with the awards granted previously.

The fair value of the performance based restricted share units under the 2013
Incentive Plan and the fair value of the time and performance options and
performance options under the 2011 Plan were estimated using Monte-Carlo
simulation models, due to the need to consider two or more stocks moving in
tandem for the valuation of these awards. The key factors that will create value
in these awards include: (1) the risk free interest rate, which is based on the
U.S. Treasury yield curve in effect at the time of grant with maturities equal
to the grant's expected life, (2) the expected term of the award, (3) the
expected dividend rate, which at present is assumed to be nil and (4) the
expected volatility of the awards over the expected term, which has been
estimated using historical volatility of the peer companies' in the S&P 500
Energy Index and two additional peer companies' stock prices and (5), for awards
under the 2013 Incentive Plan the correlations between the price of our ordinary
shares and the three year daily historical stock prices of the respective
companies in the S&P 500 Energy Index or (6), for awards under the 2011
Plan, the ultimate exit value of the Company, which is estimated using
historical volatility and implied volatility data of ten peer companies' stock
price. If any of the assumptions used in the Monte Carlo simulation models
change significantly, stock-based compensation for future awards may differ
materially compared with the awards granted previously.

In addition, we are required to develop an estimate of the number of awards that
will be forfeited due to employee turnover. The guidance on stock-compensation
requires forfeitures to be estimated at the time of grant and revised, if
necessary, in subsequent periods if actual forfeitures differ from those
estimates in order to derive our best estimate of awards ultimately expected to
vest. We estimate forfeitures based on historical experience related to our own
stock-based awards granted. We anticipate that these estimates will be revised,
if necessary, in subsequent periods if actual forfeitures differ from those
estimates.

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If there are any modifications or cancellations under our existing plans, we may
be required to accelerate, increase or cancel any remaining unearned stock-based
compensation expense. To the extent that we grant additional equity securities
to employees our stock-based compensation expense will increase by an
incremental amount.

Recent Accounting Pronouncements
See Note 2 in the audited annual consolidated financial statements for the
fiscal years ended April 30, 2012, 2013 and 2014 contained elsewhere in this
Annual Report on Form 10-K for a discussion of recent accounting pronouncements.